Good Governance in the Middle East
Oil Monarchies
The concept of ‘good governance’ is of increasing importance, as it is used
by international organisations to ensure reasonable conformity to high
standards in states that participate in the global trading regime and other
international activities. This book examines the concept of good governance
and how it is applied in the states of the Gulf Co-operation Council. These
states are particularly important because of their strategic location and
massive oil wealth. Moreover, as monarchies, in most cases without powerful
democratic representative bodies, and as Islamic countries, with a different
outlook from countries of the West, Western standards of good governance
may need to be modified in order for them to be implemented effectively.
Tom Pierre Najem is Associate Professor of International Relations and
Head of the Political Science Department at the University of Windsor,
Ontario. His research and teaching interests are in international relations and
comparative politics with particular focus on international political economy,
economic development, and political development (human rights and
democratisation). He has written widely on these subjects, and has published
two monographs on Lebanese politics.
Martin Hetherington is Researcher in Middle Eastern Studies at the Middle
East and North Africa Research Group, Foreign and Commonwealth Office,
London.
Durham Modern Middle East and Islamic
World Series 4
1. Economic Development in Saudi Arabia
Rodney Wilson, with Monica Malik, Abdullah Al Salamah
and Ahmed Al Rajhi
2. Islam Encountering Globalisation
Edited by Ali Mohammadi
3. China’s Relations with Arabia and the Gulf, 1949–1999
Mohamed Bin Huwaidin
4. Good Governance in the Middle East Oil Monarchies
Edited by Tom Pierre Najem and Martin Hetherington
Good Governance in
the Middle East Oil
Monarchies
Edited by Tom Pierre Najem
and Martin Hetherington
First published 2003
by RoutledgeCurzon
11 New Fetter Lane, London EC4P 4EE
Simultaneously published in the USA and Canada
by RoutledgeCurzon
29 West 35th Street, New York, NY 10001
This edition published in the Taylor & Francis e-Library, 2003.
RoutledgeCurzon is an imprint of the Taylor & Francis Group
© 2003 editorial matter and selection, Tom Pierre Najem
and Martin Hetherington; individual chapters, the contributors
All rights reserved. No part of this book may be reprinted or
reproduced or utilised in any form or by any electronic, mechanical,
or other means, now known or hereafter invented, including
photocopying and recording, or in any information storage or
retrieval system, without permission in writing from the publishers.
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging in Publication Data
Good governance in the Middle East oil monarchies / edited by Tom Pierre Najem
and Martin Hetherington
p. cm. – (Durham modern Middle East and Islamic world series 4)
Includes bibliographical references and index.
1. Persian Gulf States–Politics and government. I. Najem, Tom. II. Hetherington,
Martin. III. Series.
JQ1840 .G66 2003
321′.009535–dc21
2002027543
ISBN 0-203-22083-8 Master e-book ISBN
ISBN 0-203-27557-8 (Adobe eReader Format)
ISBN 0–415–29740–0 (Print Edition)
Contents
List of illustrations
Notes on contributors
Preface
Introduction
1
Good governance: the definition and application
of the concept
vii
ix
xi
xiii
1
TOM PIERRE NAJEM
2
The states of the Gulf Co-operation Council
29
NEIL QUILLIAM
3
The politics of participation in the oil monarchies
60
ANOUSHIRAVAN EHTESHAMI
4
Good international governance: implications for
Saudi Arabia’s political economy
85
RODNEY WILSON
5
Dynamics of GCC press–government relations in
the 1990s
102
NAOMI SAKR
6
Climate governance in the GCC
119
CHRISTIAAN VROLIJK
Index
137
Illustrations
Figures
6.1
6.2
6.3
Global average near-surface temperatures, 1860–2000
Global per capita CO2 emissions and population, 1998
GCC emissions compared with other regions
120
122
124
Tables
4.1
4.2
4.3
4.4
4.5
4.6
4.7
6.1
Gross domestic product indicators for Saudi Arabia
The labour force in Saudi Arabia
The budget as a percentage of GDP
The ratio of foreign debt to exports in Saudi Arabia
Capital flight from Saudi Arabia
FDI into Saudi Arabia by country, 1998
Joint ventures in Saudi Arabia
Emission reduction commitments for some Annex B countries
86
88
90
91
94
96
97
129
Contributors
Tom Pierre Najem is Associate Professor of International Relations and
Head of the Political Science Department, University of Windsor, Ontario.
Martin Hetherington is Researcher in Middle Eastern Studies in the Middle
East and North Africa Research Group, Foreign and Commonwealth
Office, London.
Anoushiravan Ehteshami is Professor of International Relations in the
Institute for Middle Eastern and Islamic Studies, University of Durham.
Rodney Wilson is Professor of Economics in the Institute for Middle Eastern
and Islamic Studies, University of Durham.
Neil Quilliam is Programme Officer, UNU Leadership Programme, United
Nations University, Tokyo.
Naomi Sakr is Lecturer in Communications, University of Westminster,
London.
Christiaan Vrolijk is a Research Fellow at The Royal Institute of International Affairs, London.
Preface
In 1999, the Institute for Middle Eastern and Islamic Studies, University
of Durham, and MENARG of the Foreign and Commonwealth Office,
established a conference series on the Middle East and North Africa. The
conference series, which was set up by Professor Anoush Ehteshami, creates
a forum for Middle East specialists in academic, business and government
circles to exchange views and share ideas on critical issues affecting the
region. To date, conferences have dealt with good governance issues, strategic
importance of the Red Sea, and relations between the Middle East and
Asia.
The book at hand is the first fruit of this joint venture. Given the strategic
importance of the Middle East and the Gulf region, we feel that this book is
very timely. Other titles, including one focusing on relations between the
Middle East and Asia, will follow.
Introduction
Over the past decade, a number of crucially important and strongly related
ideas and sets of policies, often referred to collectively under the heading of
‘good governance’, have become increasingly predominant as a political,
economic and social paradigm for the countries of the developing world. In
effect, the concept of good governance subsumes a whole range of significant
development-oriented complexes of policy, including: political and economic
liberalisation generally; the introduction and maintenance of political
transparency and accountability; the elimination of corruption; the development of civil society; guarantees of fundamental human rights, especially
political rights such as freedom of expression, freedom of assembly and
freedom from arbitrary imprisonment; the promotion of international free
trade; and the adoption of policies designed to safeguard long-term global
interests like education, health and the environment.
The primary purpose of this book is to consider the extent to which various
political, economic and social aspects of good governance have been
successfully applied, to date, within the context of the countries of the Gulf
Cooperation Council (GCC). This is potentially a very significant contribution
to existing academic literature for two reasons. First, for reasons that will be
treated in the course of Chapter 1, it should be recognised that good
governance is closely related to the globalisation process and various crucial
academic debates about its validity and implications. Since the September 11
terrorist attacks have raised the profile of the Islamic world, and led to
much increased speculation about the compatibility of Western and Islamic
societies, a detailed examination of how largely Western-derived concepts of
good governance are being applied in Islamic settings is, perhaps, particularly
timely. Second, very little has been written on good governance as it relates
to the countries of the GCC. As these are undoubtedly among the most
significant states in the world, because of their massive oil wealth and strategic
location, the dearth of material concerning how they have responded to the
increasing predominance of good governance as a development paradigm is
particularly noteworthy.
xiv Introduction
Although the individual contributors have limited the scope of their observations to those aspects of good governance that fall within their respective
spheres of expertise, and have, therefore, necessarily drawn specific
conclusions in each case, at least two important general themes may be
identified. First, with respect to each aspect of development examined by the
contributors, there have been significant policy changes in the GCC states
which are in line with good governance. However, each of the commentors
has also stressed that the extent of the changes are somewhat limited and
perhaps subject to suspension or reversal as a result of potential changes in
domestic, regional or international circumstances. Second, although good
governance is typically seen as being strongly associated with globalisation,
to the extent that some observers argue that developments are being driven
primarily by international pressures, each of the contributors in this volume
has identified domestic factors as being just as significant, or perhaps, even
more significant, with respect to the promotion of good governance initiatives
in the GCC setting.
Because good governance is a general term that encompasses a very broad
range of different political, economic and social ideas and policies, it has
proved impossible to consider every important area of development in this
book. However, we feel that, at the very least, the different chapters present
a fair cross-section of some of the most critical aspects of good governance:
political and economic liberalisation; freedom of expression and government
accountability; free trade; and international environmental policy.
The book is divided into six chapters. In Chapter 1, Tom Pierre Najem
provides the necessary conceptual base for good governance by defining the
concept, placing it within a historical and theoretical context, examining how
it is being applied generally within developing societies, identifying the
different forces and circumstances behind the widespread adoption of good
governance policies, and considers briefly some important criticisms which
are related to broader academic debates about the validity and implications
of the globalisation process.
In Chapter 2, Neil Quilliam sets the scene for the succeeding chapters by
detailing the origins and historical development of the GCC. In addition to
looking briefly at each of the member states, he considers the significance of
the organisation as a whole in both regional and international contexts, and
identifies shared priorities and common constraints.
In Chapter 3, Anoushiravan Ehteshami presents a survey of the political
liberalisation and participation initiatives undertaken by all of the GCC
member states. He considers the underlying reasons for the adoption of these
initiatives, looking at both the international and domestic forces that have
encouraged them, and examines the processes by which they are being carried
forward. He concludes that the initiatives are largely government-driven, and
Introduction xv
that, although significant reforms have been made, the fluidity of domestic
and international circumstances is such that it is difficult to establish what their
lasting impact will be.
In Chapter 4, Naomi Sakr looks at the dynamics of press and government
relations in the GCC countries in recent years. She observes that there has
clearly been considerable extension of press freedom in all of the states,
although the degree of change has been more limited in some states than
in others. She attributes these reforms primarily to changes in domestic
power alignments within the individual states, and also, to some extent, to
imperatives relating to rivalries with other regional states. Again, in all cases,
it would seem that the changes are highly circumstantial and subject to
suspension or reversal.
In Chapter 5, Rodney Wilson considers the extent to which economic
policy-making in Saudi Arabia conforms to the ideals of international
economic institutions such as the IMF and WTO. Although he demonstrates
that Saudi economic policy is becoming more consistent with the free trade
principles of such organisations, he argues that it is clear that, due to both
political and economic obstacles, progress is very gradual.
And finally, in Chapter 6, Christiaan Vrolijk examines the environmental
policies of the GCC states, focusing in particular on their participation in
global climate change initiatives. Although he has indicated that good
environmental governance policies have been put in place on a range of issues
including water conservation and prevention of oil spills, his general
conclusion is that the GCC countries, primarily for economic reasons, have
contributed little to international climate change initiatives, and, in fact,
have been strong opponents of such policies.
1
Good governance
The definition and application
of the concept
Tom Pierre Najem
Introduction
The purpose of this chapter is to define the term good governance1 as it will
be used in this volume and to place it within a historical and theoretical
context, thereby providing the reader with a broad conceptual base for
approaching subsequent chapters. The chapter consists of three sections. In
the first section, I will examine the origins of the term good governance,
consider how it has come to be applied to a broad range of related ideas and
sets of policy, and establish a working definition for the purposes of this study.
In the second section, I will consider the historical circumstances surrounding
the emergence of good governance as the predominant development paradigm
of the last decade, identify the different forces driving the adoption of good
governance policies in many states, look at the specific priorities and
constraints that are particularly relevant to good governance in the context of
the GCC countries, and assess the potential impact of the post-September 11
‘war on terrorism’ with regard to some aspects of good governance. Finally,
in the third section, I will raise a number of important theoretical issues
concerning the validity of good governance and consider how it fits into the
context of broader academic debates about development and the globalisation
process.
Defining good governance
The term good governance, at least as a reference to a more or less specifically
defined set of ideas and policies, originated in a 1989 World Bank document
entitled Sub-Saharan Africa: From Crisis to Sustainable Growth.2 Within
the context of this seminal document, the notion of good governance was
strongly associated with the types of structural adjustment policies that the
World Bank had been advocating for many years: reduced state intervention
in economic decision-making; reduced public sectors and more efficient and
2 Tom Pierre Najem
transparent public sector administration; freer markets and the elimination of
unnecessary public subsidies; and increased integration into the world
economy generally.3
The argument was that adherence to sound economic development policies
(i.e. essentially policies de-emphasising the role of the state) would, in itself,
help to promote the appropriate political environment for sustainable
economic growth – which, incidentally, would be a more inclusive and
accountable environment on the whole than most developing societies had
previously experienced. This emphatically did not mean the wholesale
adoption of Western institutions and ideals. On the contrary, the document
asserted that an important advantage of concentrating the reform agenda on
the economic development sphere was that doing so allowed the indigenous
elements to design their own political and social mechanisms. This would
render good governance a more viable and culturally sensitive alternative to
previous development approaches, which had attempted to graft Western
models onto arguably incompatible cultural settings. However, the reduced
role of the state in the economic life of society would necessarily create
important power centres outside the state sphere. The state would then have
to come to terms with these new elements, and hence, would almost inevitably
become more open and accountable. In short, a considerable degree of
political liberalisation, and perhaps even democratisation, would be a
beneficial consequence of the recommended structural adjustment.4
It must be recognised, however, that since its initial formulation in the
1989 World Bank document, the term good governance has achieved everincreasing currency in the international development discourse.5 Furthermore,
the concept has been expanded by the World Bank6 and other international
aid donors, non-governmental organisations, academics and Western
governments and politicians to encompass a much broader and more
generalised range of ideas and policies, to the extent that it is not always clear
what, exactly, one means when one is using the term. Essentially, the concept
of good governance as it is currently used includes all of the following:
economic liberalisation and the creation of market friendly environments;
transparency and accountability with respect to both economic and political
decision-making; political liberalisation, particularly democratic reforms;
rule of law and the elimination of corruption; the promotion of civil society;
the introduction of fundamental human rights guarantees, especially with
respect to political rights such as freedom of expression, freedom of assembly
and freedom from arbitrary imprisonment; and the adoption of policies
designed to safeguard long-term global interests like education, health and the
environment.7
Clearly, there are some problems with grouping so many distinct areas of
development and policy orientation together under one heading. To begin
Good governance 3
with, as the concept has been expanded to include a seemingly ever-increasing
number of new ideas and sets of policies, some would contend that it has lost
much of its initial distinctiveness as a development paradigm. Whereas the
concept originally distinguished itself from the much maligned modernisation
paradigm by placing a great deal of stress on the importance of allowing
different cultures to develop their own institutions and mechanisms for social
reform, the broader construction of good governance is more didactic in the
political and cultural spheres, and often seems to amount to little more than
a wholesale endorsement of Western ideals, practices and institutions. A
second problem is that, because good governance covers such a broad
spectrum, different organisations and individuals have come to frame their
respective interpretations of the term in divergent and potentially even
contradictory ways. In short, the current broad usage of the term often seems
to beg the question: ‘Good governance for whom and according to whom?’8
To cite just one example that demonstrates both of these problems, some
Western organisations, such as Amnesty International and Human Rights
Watch, have tended to emphasise those aspects of governance that stress
guarantees of basic human rights. While these organisations do not necessarily mean to suggest that structural adjustment is a less important aspect of
good governance, they do contend that those forms of structural adjustment
which impinge on basic human rights to health care, education and other
essential services are not compatible with the concept. Conversely, those
advocates of good governance who tend to emphasise the primacy of
structural adjustment policies and/or the importance of cultural sensitivity
might contend that too great an emphasis on introducing largely Westernderived human rights into developing societies is incompatible with the
concept.
However, even in the course of recognising these problems, I would
contend that the broad definition of good governance has now become so
widespread and pervasive that it is impossible, for all practical intents and
purposes, to insist on a more specific and rigorous definition. It might be
useful to attempt to frame such a definition in a purely theoretical work, but,
in a study like this, in which the primary purpose is to analyse the extent of
good governance developments and the nature of the processes underlying
them, a strict definition is actually somewhat counter-productive. Since the
major international sponsors of good governance are themselves taking a
broad-based approach to encouraging development, it makes little sense to
exclude from one’s analysis areas in which there have been significant
changes simply because these areas do not happen to fall within a particular
organisation’s or scholar’s specific conception of what good governance is
really all about. Clearly, to at least some extent, one must acknowledge that
good governance is ultimately about what the major international aid
4 Tom Pierre Najem
organisations, the major trading blocs, the United Nations and the most
influential countries that are promoting it define it as, and about what they are
actually doing to encourage developing countries to put it into practice.
Therefore, it is crucially important to allow for the examination and
assessment of developments in every one of the areas commonly associated
with good governance. As a consequence of this priority, the working
definition of good governance for this study is based on the broadest
reasonable conception of the term.
Good governance in a historical context
The genesis of ‘good governance’ and ‘the end of history’
The corpus of ideas and sets of policies that make up good governance has
undeniably been the predominant development paradigm of the last decade,
and has had an extraordinary, and arguably unprecedented, impact throughout
virtually the whole of the developing world. Many Western scholars and
policy-makers have not hesitated to represent good governance as the only
truly viable approach to sustainable long-term development and prosperity,
and even its most trenchant critics have been unable to propose a practicable
alternative paradigm.9 Furthermore, it must be recognised that the very term
‘good governance’ is intellectually and ideologically quite provocative,
seeming to carry within it the rather grave implication that practices
and policies outside the boundaries of the concept constitute inadequate, or
even poor, governance. It is impossible to understand the overwhelming
predominance of the paradigm, in theory or practice, without reference to the
unique historical circumstances that coincided with, and contributed a great
deal to, its genesis.
Beginning in the 1950s and extending through much of the 1970s, the
developmental paradigm adopted by most of the post-colonial countries of
Africa and the Middle East, and by a considerable number of countries in
other parts of the Third World, entailed: (1) strong state direction of the
development process and control of the means of production (particularly
in the industrial sphere) to the extent that private sectors were either
underdeveloped or non-existent; and (2) protectionist trade practices,
designed to secure national sovereignty by minimising external penetration.
However, beginning in the late 1970s, another developmental paradigm
stressing economic liberalisation, especially free trade and privatisation,
began to be asserted by Western theorists and policy-makers.10 By the late
1980s, partly in response to criticisms concerning the perceived human
costs of economic liberalisation, some advocates of this approach began to
articulate potential benefits that it seemed likely to produce in terms of
Good governance 5
political liberalisation and greater government accountability. In short, it was
suggested that economic liberalisation might be the key to establishing the
societal preconditions for democratic reforms in many countries. As noted
previously, the term ‘good governance’ originated in a 1989 World Bank
document advancing an argument along these lines.11
The theoretical linkage of economic liberalisation and structural adjustment
with increased democratisation coincided with two extremely significant
historical circumstances. The first was the decline and eventual collapse of
the Soviet Union, which had long served both as the model and as the most
forceful advocate of the heavily statist paradigm. The second was the apparent
failure of the statist paradigm in many developing countries, which had come
to be plagued during this period by endemic inefficiency and corruption on
the part of state bureaucracies, increasing foreign debt exacerbated by world
economic conditions and a host of other serious structural problems.12
In the ideological and intellectual spheres, the West’s victory in the Cold
War and the apparent failure of state-led development translated into a
considerable amount of triumphalism among the supporters of Western-style
liberal democracy and international capitalism. Some scholars, most notably
Francis Fukuyama, cited the absence of any conceivable alternative to the
globalisation of the world economy and the increasing integration of political
systems, and began to assert that the liberal democratic and capitalist form
of society can now be recognised as the only truly historically viable and
legitimate model for developing societies. In Fukuyama’s view, the
communist bloc represented the last great threat to the universal adoption of
this model, and the removal of this threat signalled ‘the end of history’.13
Of course, many followed Samuel Huntington’s lead in questioning
Fukuyama’s optimism and proceeded to identify other potential threats to
the triumph of Western democracy in the form of a ‘clash of civilisations’
among Western, Islamic and Confucian cultural blocs. However, at the same
time, the vast majority of Western policy-makers unreservedly adopted
Fukuyama’s contention that the Western liberal democratic and capitalist
model represented the best historically achievable form of society. On this
basis, they began to push increasingly vigorously for more rapid and more
thorough globalisation and for political reforms that would bring the countries
of the developing world increasingly in line with Western ideals and standards
of mass participation, transparency, rule of law and human rights.14
It is probably worth noting, at this point, that it was this transition within
the ideological and intellectual spheres that led to the expansion of the concept
of good governance from a set of ostensibly culturally sensitive prescriptions
for economic and administrative structural adjustment to a broad range of
ideas and sets of policies designed, arguably, to reproduce the Western liberal
democratic and capitalist form of society almost in its entirety in the context
6 Tom Pierre Najem
of the developing world. Whether or not the broader formulation is really
internally self-consistent and practicable, and whether or not the historical
assumptions underpinning it are valid, probably only time will tell.
In any case, irrespective of its ideological and intellectual foundations, it
should be recognised that the monopoly of the good governance paradigm is,
in practice, largely a function of the current predominance of global
capitalism. During the Cold War, it was often possible for developing
countries to establish healthy trade relations with, and to attract massive
financial aid from, the major world powers simply by adopting the appropriate
rightist or leftist political stance. The dissolution of the Soviet Union
eliminated the only major financial sponsor for development outside the
international capitalist context, and also removed the only compelling reason
for Western policy-makers to assign a higher priority to political alignments
than to their economic interests. At the same time, the sweeping changes in
the geopolitical sphere necessitated a fundamental realignment of trade
relations for many states. Furthermore, the massive economic and structural
problems confronting many developing countries meant that their respective
leaders had no alternative but to seek substantial amounts of Western aid.
This state of affairs left the major Western powers in a virtually insurmountable position to dictate terms to the developing world. In keeping with
the ideological and intellectual developments outlined previously, the
demonstration of a willingness to adopt good governance practices became
the basic precondition for financial assistance and increased trade relations.15
The application of good governance in practice: 1989–2001
General comments on assessing the progress of good
governance reforms
When assessing the extent to which the good governance paradigm has been
applied in different settings, it is important to bear some general points in
mind. First, it must be recognised that good governance is a multifaceted
ideal that is difficult, if not impossible, to fully realise in the context of
any society. Even the most developed nations have significant and readily
identifiable shortcomings with respect to some aspects of the paradigm.
To cite just a few of many possible examples, virtually all of the major
industrialised nations have struggled to reconcile the reduction of public
sector spending with the provision of essential public welfare, education
and health care services, and some leading countries (the United States
particularly) have been much criticised in the international community for
failing to adopt sound environmental policies.16
Good governance 7
Another important point is that no universally accepted or particularly welldefined order of development priorities has emerged as the theory and
application of good governance has developed. With reference to the theory
of good governance originally articulated by the World Bank, it seems clear
that economic liberalisation and structural adjustment are supposed to set the
stage for social and political changes. However, to at least some extent, it has
been necessary to adopt this conceptual model to account for the proposition,
supported by many scholars, that at least basic political reforms are required
to facilitate and secure economic reforms. For example, one might question
how it is possible to ensure that corruption is eliminated and transparency
is maintained unless there are reforms to increase the relative strength of
the judiciary and public oversight organs such as the press and civil
society groups.17
In addition to this lack of theoretical acuity about priorities, there has been
a tendency, as I have noted previously, for the different groups pushing for
the adoption of good governance policies in practice to emphasise the
importance of those aspects of the concept that are of particular concern
to them. While the World Bank and IMF have continued to lay a primary
stress on economic and administrative reforms, the United Nations and many
state actors have pointed to the need to encourage parallel development
across different sectors of society. Other groups like Amnesty International
and Greenpeace have tended to focus on specific areas like human rights and
environmental policy.
As a result of these considerations, it is very difficult to formulate a general
assessment of the progress a particular country is making towards the
adoption of the good governance paradigm as a whole. One must instead
examine the progress that is being made in specific areas and try to understand
how these developments, taken together, contribute to the progressive
adoption of more and better good governance practices in the long term.
For similar reasons, it is also quite difficult to present a general overview
of the impact that the promotion of good governance over the past decade has
had with respect to delivering real prospects for secure prosperity and truly
open and accountable government for the countries of the developing world.
Even if one is prepared to accept the highly questionable proposition that
the good governance paradigm will bring forth all of the projected benefits
if it is put into practice to a sufficient degree, it is by no means clear that
the states of the developing world will ever choose, or could ever be
persuaded, to adopt it to this extent. It is certainly true that a great many
developing countries have already put at least some aspects of good
governance into practice, but the extent of the respective states’ commitments
to truly substantive reforms, especially political reforms, is just as certainly
questionable in many cases.18
8 Tom Pierre Najem
From a practical standpoint, it must be generally assumed that strong state
structures have an overwhelmingly compelling vested interest in maintaining
their dominant position in society. The central precept of good governance,
that the state needs to relinquish its control of the economic sphere and,
ultimately, to become more open and accountable with respect to political
decision-making, is obviously directly contrary to that priority. As I have
suggested previously, it is highly probable that many states have adopted
good governance, to the limited extent that they have, only because they have
been forced to do so by the prevailing economic and geopolitical
circumstances of the last decade.19
The forces driving good governance and the responses of state
actors
In order to understand the prospects for further and more substantive changes,
it is crucially important to identify and assess the relative strengths of the
different forces that have been pushing states to acquiesce to reforms.
Moreover, one must examine the nature of the reform emphasis that these
forces have defined and consider how states have actually responded in
practice. Within this context, it is possible to identify six major sources
of either external or internal pressure that have confronted the regimes of
most developing countries over the past decade: (1) international aid donors;
(2) international trade; (3) issue-based international NGOs; (4) transmission
of values; (5) crisis of legitimacy; and (6) emergent social forces. I will now
proceed to examine each of these in turn.
1 INTERNATIONAL AID DONORS
One external factor that has been particularly significant for countries with
chronic economic and structural problems is the pressure that the World Bank,
the IMF and virtually all other major international aid donors have brought
to bear by establishing a more or less well-defined set of good governance
reforms as a precondition for financial assistance. Thus far, the primary
emphasis from most donors has been on economic liberalisation and structural
adjustment, including: debt reduction; privatisation of inefficient public sector
industries; reform of inefficient and corrupt bureaucratic institutions; the
elimination of protectionist trade practices; the reduction of public subsidies
and spending commitments; and the introduction of greater transparency with
respect to economic decision-making. The different aid agencies have tended
to attach fairly specific conditions and/or recommendations concerning each
of these areas to loans and financial aid packages, giving the recipient states
relatively little room for manoeuvre.20
Good governance 9
A secondary emphasis, which seemed to be increasing in strength over the
course of the 1990s, was on supporting the kind of political reforms that might
contribute to and/or help to secure the economic liberalisation process. This
aspect of aid agency support for good governance generally did not entail the
same kind of targeted pressure for specific reforms as part of financial
packages, but rather involved recipient states committing themselves to
certain political reforms in principle and showing at least some compliance
in practice. While greater democratisation and major institutional reform was
identified as a long-term aim, the actual focus tended to be on fairly limited
measures such as the introduction of basic human rights guarantees and the
promotion of civil society.
Obviously, many state actors in the developing world have had little option
but to fall into line with the expectations of their international creditors,
particularly with respect to economic reforms. Nevertheless, in practice, the
prescribed economic liberalisation and structural adjustment has often been
thwarted by seemingly intractable problems. Privatisation has more often
than not been impracticable since private sector elements, on the whole, have
shown little interest in taking over the inefficient and loss-making public
sector industries that it would be most beneficial to liquidate. Recommended
reductions in some public subsidies have had to be abandoned in the face of
massive popular opposition. It seems that no amount of external financial
pressure is able to generate the internal political will needed to tackle
ingrained corruption and institute substantive bureaucratic reforms. And, of
course, chronic debt continues to be such a major preoccupation with respect
to public sector resource allocation in many countries that capital realised
from structural reforms is often used to stave off immediate fiscal crises rather
than being used to establish the infrastructure needed to promote long-term
growth and prosperity.21
Ironically, a number of developing countries have more progress to show
with respect to improvements in human rights and the growth of civil society.
However, it would almost certainly be incorrect to conclude from this that
existing regimes are more seriously committed to reform in these areas or
that substantive reforms of this kind are easier to put in place. On the contrary,
the prime motivation for these reforms generally seems to be based on the
advantages that accrue to a given regime in both the international and
domestic arenas due to the perception that it is progressive and committed to
further reforms.22 Meanwhile, the actual reforms implemented thus far in
most countries have tended to be superficial, very selective and easily
reversible.23
10 Tom Pierre Najem
2 INTERNATIONAL TRADE
The second external factor, which has been just as significant or even more
significant for many states, is that good governance reforms have also been
set up in many cases as a precondition for international trade integration. For
example, major trading blocs such as NAFTA and the EU, and collective
decision-making bodies such as the WTO, have repeatedly expressed that
a commitment to good governance is a requirement for increased trade
relations and greater participation in the process of defining international
trade policies. Again, the primary emphasis is on specific changes in the
economic sphere, particularly free market reforms such as the elimination of
protectionist policies and the introduction of greater transparency, with a
strong secondary emphasis on a commitment to human rights and other basic
political reforms.24
In this area, perhaps more than in any other, the Western nations advocating
good governance have laid themselves open to criticism on the basis of setting
up self-serving double standards. The continuing growth and prosperity of the
major world economies is, to a considerable extent, dependent on opening
new markets in the developing world for their goods and services. Therefore,
they logically have nearly as much to gain from greater trade integration as
the less developed economies, and one may question the legitimacy of the
overwhelming control they exercise in terms of defining the conditions
of the integration process. Furthermore, it is not difficult to cite examples of
instances in which the major blocs have maintained tariff barriers and targeted
subsidies for their own producers while, at the same time, imposing greater
standards of openness on potential trading partners. And, of course, it often
seems that the Western economic powers are prepared to overlook the
significance of human rights abuses, detrimental environmental policies, etc.,
if the potential benefits of trade are great enough. While some countries are
excluded for perceived abuses, others with possibly even more questionable
records (most notably the People’s Republic of China) are granted most
favoured nation trade status by virtually every major economic power, are
permitted membership in the WTO, and so on.
Irrespective of this criticism, however, it is undeniable that the linkage of
trade integration with good governance has produced a significant reform
orientation in the many developing countries desperate to solidify and expand
their trade links in the increasingly interdependent global system. In effect,
though, these reforms have generally been characterised by the same kinds
of problems and limitations that have applied to the reforms encouraged by
the major aid donors.
Good governance 11
3 ISSUE-BASED INTERNATIONAL NGOS
A third external source of pressure for adopting good governance policies
has been supplied by major international NGOs looking to advance
specific reform agendas. Some of the most significant examples include
Amnesty International, Human Rights Watch, Greenpeace, and a number of
committees and organisations affiliated with the UN. Obviously, these groups
have not been able to exert anything like the kind of direct influence that
the major aid donors and trade blocs have been able to apply. However,
they have succeeded in generating a lot of activity indirectly by bringing
abuses in their specific areas of interest to the attention of the international
community. Furthermore, their effectiveness in the promotion of the good
governance agenda has been increased by the fact that, unlike the major
sponsors of broad-spectrum economic adjustment, they have been able to
concentrate their efforts on strictly defined problem areas.25
The regimes in many developing countries have attempted to cultivate
good relations with the most influential issue-based NGOs by initiating at
least some reform activity in their respective spheres of interest.26 While the
NGOs, for their part, have tended to greet such developments by expressing
cautious optimism and pointing out (sometimes quite vigorously) the need for
more substantial reforms, respective states have tended to demonstrate that
there are limits with respect to how far they are prepared to go simply to
placate idealistic foreign activists.
4 TRANSMISSION OF VALUES
The fourth and final external factor is the transmission of Western cultural
values into the developing world that has inevitably followed both in the
wake of greater economic integration, and more importantly, of the late
twentieth-century revolution in electronic communications. This factor is
obviously somewhat different from the previous three, in that it does not
derive from active and purposive pressure by Western actors to bring about
specific good governance reforms. It is comparatively passive and incidental.
Nonetheless, the development of satellite communications and the internet,
the increasing spread of the English language and other Western European
languages, the distribution of Western television programmes, films, mass
media and literature, etc., has almost undeniably had a significant, albeit
unquantifiable, impact on popular values and expectations across the
developing world.
This pressure has led some existing state elites to adopt more pro-Western
ideological orientations, while other states have attempted to minimise the
impact by restricting communications and imposing tighter media controls.
12 Tom Pierre Najem
Both strategies are somewhat problematic. The former approach not
only alienates traditionalist social elements that, in many countries, remain
quite strong, but also poses problems with respect to elements that favour
greater Westernisation. Even in the long term, few developing countries will
be able to offer realistic prospects for the kind of Western living standards
that exposure to Western media output has led many people to expect. On
the other hand, the more restrictive approach is deeply unpopular with
progressive social elements, and also stands in more direct contradiction
to the standards of liberalisation and free expression that potential Western
aid donors and trade partners are actively pushing for. Furthermore, states
attempting to impose very strict limits on the influx of foreign ideas, to the
extent of cutting their intelligentsia off from major networks of international
intellectual exchange and reducing the numbers of students educated in the
world’s leading institutions, also run the risk of falling substantially behind
in the technological sphere and becoming progressively less competitive
economically as a result.
5 CRISIS OF LEGITIMACY
An important internal factor that has contributed greatly to the widespread
adoption of good governance policies is the increasing crisis of legitimacy that
has confronted many regimes in the developing world over the past decade.
The chronic poverty and other social problems that have resulted largely due
to world economic conditions, rapid population growth and the essential
failure of the state-led development paradigm have caused many people in
developing countries to question the traditional bases of regime legitimacy
in their societies and to begin pushing for government based on alternative
societal paradigms. Existing regimes have had to reorient or reinvent
themselves accordingly, generally with reference to both externally and
internally derived ideological poles. The external pole consists of Western
values generally and the good governance paradigm particularly, while the
internal pole tends to be grounded in a reassertion or reformulation of fundamental religious, cultural or nationalistic values. The contrast of ideological
alternatives has been particularly apparent in the Islamic world, where
regimes have been hard pressed to accommodate popular pressure for more
accountable and representative government along Western lines on the one
extreme, and greater adherence to Islamic law and tradition on the other.
The adoption of good governance reforms has helped existing regimes to
respond to their respective crises of legitimacy in at least four ways. First,
introducing reforms has allowed regimes to bolster their legitimacy by
distinguishing themselves from past abuses and oppressive policies and by
presenting to the public at least the possibility that future, and perhaps more
Good governance 13
substantive, reforms are possible within the existing system. Second, the
concentration of public attention on particular aspects of reform, especially
carefully managed political reforms such as the selective introduction of
human rights guarantees, has sometimes served as a useful distraction from,
or compensation for, intractable problems in other areas, perhaps most
especially in the economic sphere. Third, reforms which allow for greater
freedom of expression, some freedom of assembly and demonstration, etc.,
have helped some regimes to ease tendencies towards more dramatic and
damaging forms of opposition. And finally, taking the initiative with respect
to introducing and pushing through reforms actually allows regimes to exert
a considerable amount of control over the nature and scope of the reform
process, thus allowing them to influence developments in vital areas, co-opt
potential opposition elements and consolidate their dominant position in
society generally.27
6 EMERGENT SOCIAL FORCES
A final factor which has placed many existing regimes in the developing
world under significant pressure to implement good governance reforms is
the gradual emergence of indigenous civil society elements. This process
is probably, to at least some extent, a natural consequence of increasing
development and more widespread education as a whole, but it has probably
also been strongly encouraged by all five of the previous factors. The last
decade particularly has seen the evolution in many countries of a wide range
of organisations, associations and citizens’ groups pushing for many kinds of
specific social and political change, and for greater freedom and greater
participation in decision-making generally.
Although these groups have almost certainly provided some stimulus for
reform, many regimes have responded to this kind of pressure by adopting
fairly successful multifaceted defensive strategies. One approach has
involved engaging civil society elements in dialogue with a view to settling
potential differences. This has sometimes led to compromise arrangements
whereby emergent groups may extract some concessions from the regime
but are effectively co-opted in the process. A second approach, which is often
very effective and which is favoured by many regimes, is the creation, by the
state, of ostensibly autonomous or semi-autonomous groups that work to
counter the influence of more opposition-oriented groups in the civil society
sphere. Finally, while reform legislation guaranteeing freer expression, right
to assembly and other freedoms has theoretically made it much more difficult
for them to do so, many regimes have not hesitated to use their police and
other coercive mechanisms to actively suppress groups that exceed the strictly
limited boundaries of dissent which they are prepared to tolerate.28
14 Tom Pierre Najem
Good governance and the GCC: 1989–2001
Obviously, the primary purpose of this book is to consider the extent to which
different aspects of the good governance paradigm have been adopted in
the countries of the GCC and to analyse the processes underlying the reforms
that have been put in place. Therefore, the best way to understand how each
of the different factors identified in the last section have contributed to
developments in the GCC is to refer to the detailed research that will be
presented in subsequent chapters. However, it will be useful at this point to
briefly consider some general priorities and constraints that apply to all of the
GCC countries and which have helped to determine the relative significance
of the respective influences promoting good governance reforms over the
past decade.
To begin with, it should be recognised that the GCC countries, due to their
substantial oil revenues, have not generally been subject to the kinds of
chronic fiscal crises and other structural problems that have plagued most
other countries in the developing world. For this reason, the impact that the
World Bank, the IMF and other international aid donors have had in terms of
pressuring the GCC regimes to adopt good governance reforms has been
extremely limited.
This is not to say that there has been no effective external pressure for
reforms. On the contrary, all of the GCC countries are heavily dependent on
international trade and have been working very hard to consolidate and
improve their existing trade links. One consequence of this is that they have
had to be somewhat responsive to Western pressure to adopt at least those
aspects of the good governance agenda that are commonly linked with trade
integration, namely the elimination of protectionism and the introduction of
greater transparency.29
The GCC regimes have also had to take at least some account of the other
major external factors, such as issue-based NGOs and transmission of values,
but I would argue that both of these have been less significant in the Gulf
than they have in many other parts of the developing world. The countries’
relatively strong economic position has given them some immunity from the
NGOs, since these mainly rely on exerting pressure through aid donors, and
the transmission of values has been moderated in many cases by the generally
conservative social orientations of the societies and the respective regimes’
ability to maintain tight media controls.
The major internal impetus for reforms has been supplied by a crisis of
legitimacy that originates primarily from economic problems associated with
rapid population growth, economic mismanagement and world economic
conditions such as the fluctuation of oil prices. The regimes have responded
to increasing public dissatisfaction partly by instituting reforms to eliminate
Good governance 15
corruption and to allow for wider participation in decision-making and freer
expression of ideas in the media. However, it should be noted that the regimes
have also been obliged to respond to indigenous pressures for a strong
reassertion of traditional Islamic values. The two strands of policy are not
necessarily compatible and it is not yet clear whether a workable synthesis is
possible, or which tendency will ultimately prevail if a choice must be made
between the two.
A final observation that might be made about the GCC generally is that,
particularly with respect to the first few points raised in this section, it is quite
different than most of the other settings that scholars have previously included
in research about good governance. The focus of the existing literature is
on the extremely significant role that the major Western aid donors have
played in the practical application of the good governance paradigm, and,
as I observed above, this role has been very limited in the GCC setting.
Consequently, this study affords a good opportunity to examine the potential
significance of the other factors, particularly the external influence of
international trade and the internal pressure associated with the crisis
of legitimacy.
Good governance and the war on terrorism
Obviously, when one is attempting to place good governance in a historical
context, it must be recognised that the September 11 terrorist attacks on
the United States and the ensuing international ‘war on terrorism’ are particularly significant developments, especially with reference to Islamic societies.
It is probably too early to tell if these events will initiate a fundamental
paradigm shift in relation to the theory and practice of international
development, but the early indications are that the Western powers are
beginning to rethink the implications of their increasing emphasis over the
last decade on the importance of political liberalisation and the growth of
civil society.
The general orientation of Western foreign policy at present seems to be
on taking all possible measures to curtail international terrorism, especially
terrorism as an expression of Islamic extremism. With respect to the
developing countries of the Islamic world, this means that, for the foreseeable
future, the West will be broadly supportive of a reassertion of state power
where such is useful for suppressing potential terrorist elements. As the
primary opposition elements in most Islamic societies tend to subscribe to
fairly extreme interpretations of Islam, they can at least be identified as
suspect elements even if they are not actually working to promote significant
terrorist activity. Therefore, at least from a hypothetical perspective, they are
all legitimate targets. It seems likely that existing regimes will seize on this
16 Tom Pierre Najem
point as a justification for taking strong measures to secure their own
positions. This may result in the substantial reversal of much of the progress
that was made in the 1989–2001 period, and one must question whether any
kind of substantial political liberalisation, even the growth of more moderate
Islamic, and for that matter non-Islamic, civil society elements, can be
expected in such circumstances.
Good governance in a theoretical context
Good governance: a new development paradigm?
As I observed briefly in the first section of this chapter, the evolution of the
concept of good governance from a fairly specific set of economic and
structural adjustment prescriptions into a broad range of different ideas
and sets of policies arguably had the effect of stripping away much of its
distinctiveness as a development paradigm, particularly in comparison to the
modernisation paradigm developed by Seymour Martin Lipset and other
theorists in the 1960s.30 Many critics of good governance have suggested
that, apart from insubstantial ideological rhetoric about the long-term benefits
of the world economy and the importance of cultural sensitivity, there is
actually very little difference between the two paradigms. If this line of
argument is valid, then good governance is vulnerable to much of the criticism
formerly directed at the modernisation paradigm, and one must question if it
really adds anything new to existing theories of development.
The fundamental contention of the initial modernisation theory was that
there was a strong correlation between modernisation, in terms of quantitative
factors like GNP, per-capita income, urbanisation, literacy, etc., and the
development of democratic institutions and modes of behaviour in a society.
The practical emphasis of the modernisation paradigm, therefore, ostensibly
involved encouraging economic and social development along Western lines
in order to establish a functional base in developing societies for Westernstyle democratic institutions. However, while the theory clearly defined a
need for conditions in a society to evolve over time, its account of institutional
change was more ambiguous. It was generally assumed that putting functional
Western institutional models in place as soon as possible would be preferable
to the evolution of indigenous institutions, not only because it would be more
efficient than the historical process of trial and error that accompanied the
evolution of democratic institutions in the West, but also, and perhaps even
more importantly, because it would provide tried and tested safeguards that
would enable developing countries to avoid some of the catastrophic mistakes
and reversions to extreme tyranny that plagued many Western countries’
early experiments with democracy.
Good governance 17
The modernisation theory, at least in its initial formulation, has certainly
been somewhat discredited historically by the fact that substantive democratisation clearly has not occurred in many developing countries that have
actually achieved the levels of modernisation with respect to many, if not
most, of the factors that it suggested would produce a concurrent process of
democratisation. While advocates of the theory have advanced a number
of different explanations for this, critics have questioned its fundamental
validity on at least two significant theoretical grounds.
First, as early as the 1970s, Andre Gunder Frank, Fernando Henrique
Cardoso and other theorists, who came to be known collectively as the
dependency school, argued that the modernisation paradigm was the product
of an elementary misconception concerning the true nature of the relationship
between the developed and developing worlds.31 While the modernisation
theorists held that the developed world was assisting the developing world to
evolve towards greater economic prosperity and more democratic forms of
government by encouraging countries to adopt Western economic practices
and political institutions, these theorists, essentially working on the basis
of Marxist assumptions about the global expansion of the capitalist mode of
production, argued that the interference of the developed world in the affairs
of the developing world actually amounted in practice to little more than the
spread of capitalism. And even worse, that this process was being conducted
in such a way that the developing world would be placed in a perpetually
dependent position in relation to the more advanced capitalist interests
entrenched in Western societies. According to dependency theory, the best
way to avoid enduring penetration by, and the loss of all effective social
power to, exogenous capitalist interests, was to boycott the international
capitalist economy to the greatest possible extent and to stubbornly defend
indigenous control of domestically based means of production.
The second criticism is directed not at the economic assumptions of
modernisation theory, but rather at its cultural assumptions. According to
cultural critics, modernisation theory fails to account for the possibility that
Western-derived values and institutions might be fundamentally incompatible
with non-Western cultures. Moreover, it appears to assume that values and
institutional approaches grounded in non-Western cultures are inherently
inferior and could not possibly produce anything to equal or exceed existing
Western standards. Critics have contended that, from a more objective
philosophical standpoint, these assumptions constitute an indefensible fusion
of means and ends. Assisted modernisation is valid only to the extent that it
provides developing societies with more advanced means to pursue ends (i.e.
values and ultimate goals) that they define for themselves. Hence, economic
assistance and many forms of intellectual exchange are welcome. However,
if Western participation in development is carried to the extent that the
18 Tom Pierre Najem
promotion of Western ends becomes the end in itself, this represents a form
of cultural imperialism that is not only likely to be unworkable in practice but
also morally wrong.
In the following two parts of this section, I will consider briefly the extent
to which the good governance paradigm might be similar to the modernisation
paradigm in the sense of being susceptible to criticism on these economic
and cultural grounds, and I will look at some of the potential implications of
a high level of similarity. Although the good governance paradigm is very
similar to the modernisation paradigm in many essential respects and can be
criticised on similar grounds, I would also contend that the existing criticisms
are hardly definitive and that, for the time being at least, there seems to be no
workable alternative paradigm that offers better prospects for the people of
the developing world.
Good governance and the globalisation process
It is hardly surprising that many dependency theorists and scholars working
in the broader Marxist context have dismissed the concept of good governance
as merely an updated version of modernisation theory, a new type of
ideological sugar-coating for the economic exploitation of the developed
world that they see as the main aim of the globalisation process. Even from
a less pejorative theoretical perspective, it is difficult to deny that there is a
strong synergistic relationship between good governance and economic
globalisation, a point underscored by the fact that the concept of good
governance originated with the World Bank, one of the strongest advocates
of the globalisation process.
As I have observed previously, the economic pressure exerted by various
Western actors is perhaps the main force driving the states of the developing
world to adopt good governance policies, and the primary emphasis of this
pressure has been on economic reforms that would undoubtedly tend to lay
developing economies open to exploitation by the major economic powers.
While the advocates of globalisation argue passionately that the economic
reforms will eventually lead to sustainable growth and prosperity for
developing nations as well as benefiting the stronger economies, the concept
of good governance has provided an additional justification for the process
by suggesting that the economic reforms will also set the stage for political
and social reforms that will significantly increase quality of life for
populations across the developing world. Hence, the pressure for greater
globalisation is perceived as making good governance possible, while good
governance is perceived as making greater globalisation worthwhile for the
people of the developing world.
Many critics of good governance have questioned the central assumption
Good governance 19
that weakening the power of the state in the economic sphere will necessarily
lead to greater political liberalisation and democratisation. Some have pointed
to the possibility, or even probability, that emergent bourgeois elements will
ally themselves with existing political elites so long as these work to protect
and advance bourgeois interests. Others have argued that the penetration by
exogenous economic influences will be so overwhelming as to neutralise the
potential influence of indigenous elements in any case.
Advocates of good governance might answer this criticism by contending
that, particularly as the application of good governance has developed in
practice, the theoretical emphasis on economic development has become
balanced by a greater appreciation of the importance of political and social
changes. As I have noted several times in the course of this chapter, many
good governance theorists have argued that at least basic political and social
reforms are needed to facilitate and secure economic changes. The major
sponsors of good governance have accordingly placed greater emphasis on
such reforms, and many countries have introduced basic human rights
guarantees and permitted the growth of civil society elements as a result of
this. In short, good governance, as it is now conceived, is not just a by-product
of the economic globalisation process. Good governance no longer means
simply that economic changes will pave the way for political liberalisation,
but rather that economic change and political liberalisation go hand in hand
to a great extent.
However, even allowing for this change of emphasis, I would suggest that
one must be cautious in assessing the nature of the relationship between good
governance and globalisation. For one thing, Western economic pressure is
still the main force pushing developing states to adopt good governance
reforms, and it will almost certainly continue to be so for the foreseeable
future. Furthermore, a real tension exists between the economic priorities of
globalisation and the stated political and social aims of good governance.
Political change in a society, if it is too rapid or too violent, can disrupt the
stability of a society to the extent that it is difficult, if not impossible, to have
favourable economic relations with that society for a considerable period of
time. Therefore, it would be more accurate to say that economic globalisation
and political liberalisation go hand in hand only if the political liberalisation
can be carefully managed to ensure enough stability in a society that profitable
economic interaction is possible. Global powers may be sincerely committed
to democratisation and improvements with respect to human rights on
humanitarian and ideological grounds, but their principal economic interests
dictate that these changes must take place in the context of gradual social
evolution rather than rapid and disruptive revolution.
Whether or not it will be possible for the West to oversee this kind of
orderly transition to democratisation while, at the same time, reaping the
20 Tom Pierre Najem
benefits of economic globalisation remains to be seen. One must conclude that
the real test of the West’s commitment to substantive political liberalisation
and social change in the developing world is to be found in the nature of their
response if continuing historical developments favour greater democratisation
and social equity on the one hand, but potentially jeopardise their economic
interests on the other.
Another point that perhaps needs to be stressed here is that even the most
strident critics of good governance and the globalisation process have been
unable to propose a workable alternative for carrying development forward
in societies where the need for external financial assistance and the economic
stimulus associated with increased trade is clearly very great. It may or may
not be true that economic globalisation will ultimately benefit the capitalist
interests of the developed world to a greater extent than it does the peoples
of the developing world. For the time being, the salient fact seems to be that
it represents the possibility of producing some benefits in societies where
conditions could hardly be much worse than they already are.
Good governance and Islam
The other great criticism of the good governance paradigm is that it constitutes
just one more addition to a long line of ideological rationales for Western
cultural imperialism. As I have noted several times in the course of the
chapter, one of the paradigm’s supposed strengths, initially, was its cultural
sensitivity, as expressed in the idea that a concentration on reforms in the
economic sphere would leave different societies free to develop their own
institutions and mechanisms for social change. However, as good governance
has become more and more strongly associated with calls for the introduction
of Western-derived political and social institutions and practices, and perhaps
Western-derived human rights particularly, the concept has undoubtedly
become more vulnerable to criticism on cultural grounds.
Even bearing this in mind, I would suggest that the paradigm’s cultural
assumptions cannot necessarily be regarded as a fatal flaw unless it can be
demonstrated that there is an unresolvable incompatibility between its liberal
democratic orientation and the cultural circumstances of the societies it is
being applied to. If some of the underlying assumptions and some of
the specific values are treated as negotiable by both the developed and the
developing societies, there seems to be at least a possibility that a workable
cultural synthesis is achievable. Although it may be true that there are cultural
factors leading many developing societies towards forms of government that
do not embrace all the assumptions of Western liberal democracy, it is also
undeniably the case that there are increasingly strong indigenous currents
Good governance 21
across the whole of the developing world in favour of reforms that do embrace
many aspects of it. Within the context of this study, which looks at societies
in which Islam is a prevalent cultural force, it is particularly important to
consider the question of whether or not good governance and Islam are really
all that incompatible, either theoretically or in practice.
Islam, like most other developed religious systems, is complex and subject
to a wide variety of interpretations in different circumstances and settings.
Generally speaking, there is no all-embracing consensus among Islamic
religious thinkers and leaders about many key questions of identity and
practice, and in this context it should be noted that there is no real consensus
within the Islamic discourse about whether or not, or to what extent, Islam is
compatible with the sort of Western liberal democracy that good governance
is arguably designed to promote. The debate about this issue is sweeping and
complex, and hinges on fundamental questions about how Islam relates to,
or more precisely, should relate to, sovereignty, legitimacy and authority in
society. Obviously, it is impossible for me to examine these matters in much
detail in the context of this chapter. However, although it entails the risk of
presenting a considerably oversimplified picture, I do feel that it is important
to examine them briefly.32
Within the Islamic discourse there is a more or less generally accepted
conception of a legitimate political order. God (Allah) is recognised as the
absolute sovereign and the proper function of the state is to provide and
maintain an environment wherein people live according to the divine will.
Consequently, the state is generally seen as being integral to, and inseparable
from, the broader religious context. The emphasis tends to be directed towards
community welfare, with the highest good being seen as the realisation of the
Islamic normative ideal – a social order that conforms to God’s will as
completely as that of the original Muslim community founded by Muhammad
in the seventh century AD.
However, concerning the specifics of exactly what the role of the state
entails, how the normative ideal can best be realised in the modern world, and
what Muslims should be doing in the political sphere to contribute to the
creation of a truly Islamic social order, the Islamic discourse becomes
fragmented into a considerable number of distinct and largely irreconcilable
viewpoints. Critical questions include: What are the truly essential elements
of Islamic practice? Can a state be seen as truly legitimate in the absence of
the full implementation of Islamic law (shariah)? Does the shariah need to
be added to or reinterpreted in order to serve as the basis of a modern society?
Are the traditional religious scholars (ulama) the only ones qualified to
interpret the divine will for society and what role should they play in the
political sphere? Is theocracy built into Islam, or can there be such a thing
22 Tom Pierre Najem
as an Islamic democracy? The list of questions goes on and on, and there are
a whole range of answers to each one. Whether or not a given answer is a
legitimately Islamic one depends upon which authority one consults.
On the one extreme, there are scholars who contend that only a state which
fully implements the shariah is acceptable, that all states which fail to do so
are un-Islamic and that these states must be boycotted, and eventually,
overthrown by pious Muslims. On the other extreme are scholars who take
the view that even very flawed states have legitimacy and should not be
overthrown unless the practice of the most essential aspects of the Islamic
faith are threatened. Because there really is no consensus, no truly authoritative and fully defined vision of an Islamic state, individual Muslims have
to determine their own position with respect to the range of views expressed
in the Islamic discourse. To a great extent, they must form their own
conclusions about the appropriacy of the political orders in their respective
societies.
Obviously, some of the fundamental characteristics of Western-style liberal
democracy are fairly sharply at odds with the ideal Islamic conception of a
legitimate political order. The liberal democratic political order is based on
popular rather than divine sovereignty and there is a de facto, and in most
cases also a de jure, separation between religion and the public sphere.
Religious matters are generally confined to the private sphere, and belief and
practice are subject to individual preferences. This reflects a general emphasis
on the liberty and rights of the individual as opposed to the welfare of the
community at large.
However, as a number of Western scholars such as John L. Esposito,
Olivier Roy and Fred Halliday have noted, the prevailing political order in
much of the Islamic world is, in some very important respects, not much
closer to the Islamic ideal than Western liberal democracies are.33 And,
indeed, this has been the case for a very great part of Islamic history. Although
there have always been elements who have responded to this reality by calling
for the overthrow of the political order and some kind of restoration of a
truly Islamic state, the historical tendency within what might arguably be
regarded as the Islamic ‘mainstream’ has been the effective acceptance
of the political status quo, however flawed it might be, with one critical
condition: that the state continues to provide a secure environment in which
Muslims are able to practise the faith and live righteously. This never
amounted to an acceptance of a separation of church and state in principle,
but in practice it did mean that the state often occupied a somewhat
autonomous position in relation to matters of faith. The fundamental reasoning underpinning this, admittedly massive, compromise is the recognition
that basic political and social stability is a necessary prerequisite for the
communal practice of Islam.
Good governance 23
If Islam can legitimately be seen as functionally compatible with secular
authoritarian regimes, even if this is widely recognised as being a necessary
evil from a more idealistic standpoint, then one may naturally question why
Islam should not be functionally compatible with Western-style liberal
democratic regimes. Certainly, the liberal democratic framework allows for,
and actually ostensibly guarantees, that Muslims are free to practise their
religion, probably with even fewer constraints than they are likely to
encounter in authoritarian settings. At least on the broad theoretical level, it
seems that there is no essential incompatibility between the ultimate aims of
the good governance paradigm and Islamic culture as it presently exists.
On the practical level, however, there are some important points of conflict,
especially in those areas where the encouragement of good governance has
developed to the extent of becoming a wholesale endorsement of Western
values and standards. As a demonstration of this, I would cite just a few
examples of particularly emotive complexes of issues where the Western and
Islamic cultural mainstreams have very divergent assumptions: women’s
rights and the basic conception of the role of women in society;34 personal
liberty and freedom of expression, to the extent that these encompass practices
which openly demean fundamental religious and social values and undermine
public morality; and fundamental distinctions between the civil and religious
spheres in the areas of marriage and family law, education, etc. If the Western
sponsors of good governance wish to defend themselves against the charge
of cultural imperialism, they obviously must begin by becoming more
sensitive to Muslim convictions in these areas. Furthermore, it seems likely
that both the West and the Islamic world would benefit from the establishment
of a clearer theoretical and practical distinction between those aspects of the
current good governance agenda that are truly essential and those that are
merely derived from Western cultural preferences.
A further, and far more troubling, contradiction between the practice of good
governance and the Islamic cultural context results from the current prevalence
of extreme anti-Western, anti-capitalist and anti-democratic interpretations of
Islam among the most significant opposition elements in many Islamic
societies. It should be observed that the movements based on such precepts tend
to be at least as culturally imperialistic in their ultimate aspirations as the
Western elements they demonise. In short, while they argue that the West is
using economic pressure and other means to impose its values and institutions
on their societies, they do not hold, as a rule, that this is invalid because it is
wrong to impose values on a society. On the contrary, according to their
extreme reading of Islam, it is perfectly acceptable to impose values. The point
is that the values imposed must be Islamic values. Their stated aim is not merely
to reverse Western influence so as to reassert Islam in their own societies, but
ultimately to spread Islam, as they interpret it, to every country in the world.
24 Tom Pierre Najem
In any case, if the political liberalisation emanating from the implementation of the good governance paradigm effectively serves only to open the
political process to these kinds of extremist Islamic elements, the policy
threatens not only vital Western economic interests but also vital security
interests and obviously becomes largely self-defeating from the Western point
of view. Broadly speaking, there are two schools of thought about the
implications of Islamic extremism in relation to the question of how the West
should proceed with the encouragement of good governance reforms.
The first school of thought holds that political liberalisation and civil
society should be even more vigorously encouraged in order to provide the
political space in developing societies for the growth of moderate opposition
elements. The rationale underlying this is the largely untested assumption
that the extremist movements have only been able to attract mass support
because the governments of many Islamic societies have been so oppressive
and so closed that the masses have no viable alternative opposition which
they can support in order to address their grievances.
The second school of thought holds that the only way to promote security
in the long term is to provide strong support for existing pro-Western regimes,
and to focus on eliminating extremist elements and hostile regimes that
support them. While the advocates of this approach strenuously object to
suggestions that this entails a fully realised clash of civilisations between the
West and the Islamic world, it is difficult to understand how the circumstances
it is likely to create can do anything but exacerbate the popular tensions and
anti-Western feelings that already permeate so many Islamic societies.
As I have already observed, the indications, at present, are that the second
school of thought has become dominant with respect to defining the foreign
policies of most of the major global actors. As the post-September 11 war on
terrorism almost certainly entails a significant reassertion of state power as
a bulwark against Islamic extremism, this policy orientation potentially
represents a significant reduction of Western support for development of the
political and social aspects of good governance in many societies.
Conclusion
My aim in this chapter was to define the term ‘good governance’ as it will
be used in this volume and to place it within a historical and theoretical
context, in order to provide the reader with a necessary conceptual base for
approaching subsequent chapters. Each of the three main sections was
devoted to examining key issues relating to the definition of the concept and
its application in practice over the course of the last decade.
In the first section, which was concerned with defining good governance,
I examined the origins of the term and considered how the concept evolved
Good governance 25
from a set of fairly specific policy recommendations for economic reform
and structural adjustment to a broad range of related ideas and sets of policy,
incorporating all of the following: economic liberalisation and the creation
of market friendly environments; transparency and accountability with
respect to both economic and political decision-making; political liberalisation, particularly democratic reforms; rule of law and the elimination of
corruption; the promotion of civil society; the introduction of fundamental
human rights guarantees, especially with respect to political rights such as
freedom of expression, freedom of assembly and freedom from arbitrary
imprisonment; and the adoption of policies designed to safeguard long-term
global interests like education, health and the environment. Although I
observed that there are some problems with the broad formulation of the good
governance concept, I concluded that the pervasive usage of this wide-ranging
definition, particularly by the most important international elements pushing
for the adoption of good governance reforms, necessitated that the working
definition for the purposes of this study should be as broad as reasonably
possible.
In the second section, which was concerned with placing good governance
in a historical context, I began by considering the dramatic geopolitical events
surrounding the emergence of good governance as the predominant
development paradigm of the last decade, most significantly the dissolution
of the Soviet Union and the widespread failure of the heavily statist
development paradigm that had previously been dominant in much of the
developing world for decades. I then proceeded to identify the different forces
driving the adoption of good governance policies in many states. These
included six major sources of either external or internal pressure that have
confronted the regimes of most developing countries over the past decade:
(1) international aid donors; (2) international trade; (3) issue-based
international NGOs; (4) transmission of values; (5) crisis of legitimacy; and
(6) emergent social forces. After considering these factors in detail, I
identified international trade and the crisis of legitimacy as being particularly
relevant factors to with respect to the adoption of good governance reforms
in the context of the GCC countries, and observed that the prevalence of these
two factors, as opposed to the influence of international aid donors,
distinguishes the region from much of the rest of the developing world. I
concluded the section by suggesting that the post-September 11th war on
terrorism might lead to a significant reduction in emphasis on the political
liberalisation aspect of good governance, and possibly even a substantial
reversal of the reforms implemented in this area during the 1990s.
Finally, in the third section, which was concerned with placing good
governance in a theoretical context, I began by considering the contention
advanced by many critics of good governance that it constitutes little more
26 Tom Pierre Najem
than a reformulation of the much maligned modernisation paradigm. I
proceeded to consider the extent to which the good governance paradigm
might be similar to the modernisation paradigm in the sense of being
susceptible to criticism on the basis of its fundamental economic and cultural
assumptions, and looked at some of the potential implications of a high level
of similarity. Although I suggested that the good governance paradigm is
very similar to the modernisation paradigm in many essential respects and can
be criticised on similar grounds, I would also contend that the existing
criticisms are hardly definitive and that, for the time being at least, there seems
to be no workable alternative paradigm that offers better prospects for the
people of the developing world.
Notes
1 As the subsequent pages will demonstrate, there is no single agreed definition of
the term. In fact, the term is used to encompass a wide range of issues dealing
with governance.
2 World Bank, Sub-Saharan Africa: From Crisis to Sustainable Growth
(Washington: World Bank, 1989).
3 Ibid.
4 Ibid.
5 Development agencies (as well as their critics) have an extensive body of
literature on good governance available on the Web.
6 World Bank, Governance and Development (Washington: World Bank, 1992);
World Bank, Governance: The World Bank Experience (Washington: World
Bank, 1993); World Bank, The World Bank and Participation (Washington:
World Bank, 1994).
7 United Nations Development Programme, Public Sector Management,
Governance and Sustainable Human Development (New York: UNDP, 1995);
International Monetary Fund, ‘IMF Adopts Guidelines Regarding Governance
Issues’ (Washington, DC: International Monetary Fund, 1997); British Council,
‘British Council, Good Governance, Law and Governance Briefing’, Issue 4
(London: British Council, 1997); Overseas Development Administration,
‘Good Government’, Technical Note, no. 10 (London: ODA, 1993).
8 For a detailed discussion of these points, see Rita Abrahamsen, Disciplining
Democracy: Development Discourse and Good Governance in Africa (London:
Zed Books, 2000), chapter 3.
9 Even though this may indeed be the case, a comprehensive and clearly defined
body of academic literature dealing with the concept of good governance has
not yet been established.
10 For a brief overview of the subject, see Stephan Haggard, Pathways from the
Periphery: The Politics of the Growth in the Newly Industrializing Countries
(London: Cornell University Press, 1990).
11 For a broad overview of development theory, see P.W. Preston, Development
Theory: An Introduction (Oxford: Blackwell Publishers, 1996).
12 Ibid., chapters 15 and 16.
13 Francis Fukuyama, ‘The End of History?’ The National Interest 16, no. 16
(1989), pp. 3–18.
Good governance 27
14 Samuel Huntington, ‘The Clash of Civilizations’, Foreign Affairs 72 (Summer,
1993), pp. 22–49.
15 For the role of international aid agencies, see O. Stokke (ed.) Aid and Political
Conditionality (London: Frank Cass, 1996) and H. Mosely, Aid and Power: The
World Bank and Policy Based Lending (London: Routledge, 1995).
16 For example, George W. Bush’s environmental policy has been much criticised
worldwide.
17 For three good studies which deal with these issues with respect to the Middle
Eastern and North African context, see Hassan Hakimian and Ziba Moshaver
(eds), The State and Global Change: The Political Economy of Transition in the
Middle East and North Africa (Richmond, Surrey: Curzon, 2001); Eberhard
Kienle, A Grand Delusion: Democracy and Economic Reform in Egypt
(London: I.B. Tauris, 2001); Clement Henry and Robert Springborg, Globalization and the Politics of Development in the Middle East (Cambridge:
Cambridge University Press, 2001).
18 For a detailed discussion of this, see Hakimian and Moshaver (eds), The State
and Global Change, Kienle, A Grand Delusion, and Henry and Springborg,
Globalization and the Politics of Development in the Middle East.
19 As well, see the arguments put forth in Emma Murphy, Economic and Political
Change in Tunisia: From Bourguiba to Ben Ali (London: Macmillan Press,
1999).
20 O. Stokke (ed.) Aid and Political Conditionality; H. Mosely, Aid and Power:
The World Bank and Policy Based Lending.
21 For an examination of these and other issues related to the outcomes of
economic liberalisation and privatisation policies, see the five articles in Emma
Murphy (ed.) ‘Special Issue on The State and the Private Sector in North
Africa’, Mediterranean Politics 6, no. 2 (Summer, 2001). As well, Charles
Tripp, ‘States, Elites and the Management of Change’ and Roger Owen, ‘The
Middle Eastern State: Repositioning not Retreat?’ both in Hassan Hakimian and
Ziba Moshaver (eds) The State and Global Change, chapters 9 and 10.
22 For a detailed examination of this point, see Tom Pierre Najem, ‘Human Rights
Development in Morocco: A New Era?’ Mediterranean Journal of Human
Rights 4 (Double Issue, 2000), 87–104; Tom Pierre Najem, ‘Human Rights,
Political Expediency and the War on Terrorism: Implications for Morocco’
Mediterranean Journal of Human Rights 5 (December 2001).
23 For a discussion of international Human Rights discourse, see David Forsythe,
The Internationalization of Human Rights (Lexington, Mass: Lexington Books,
1991); Kurt Mills, Human Rights in the Emerging Global Order: A New
Sovereignty? (Basingstoke: Macmillan, 1998).
24 See Rodney Wilson’s chapter in this volume.
25 For a look at the role (and effectiveness) of NGOs with respect to a host of
international issues, including environment and human rights, see articles in
volume 77 no. 1 (January 2001) and no. 2 (April 2001) of the prestigious journal
International Affairs.
26 This is particularly true with respect to international human rights organisations,
such as Amnesty International. See Tom Pierre Najem, ‘Human Rights
Development in Morocco: A New Era?’ and Tom Pierre Najem, ‘Human Rights,
Political Expediency and the War on Terrorism: Implications for Morocco’.
27 See Najem, ‘Human Rights Development in Morocco’ and ‘Human Rights,
Political Expediency and the War on Terrorism’ for how this process has
evolved with respect to the Moroccan case.
28 Tom Pierre Najem
28 Both sets of strategies have been widely employed in the MENA region – the
latter increasingly as the former strategy fails to effectively co-opt (and quiet)
oppositional forces. This pattern is particularly true in Tunisia, Egypt and,
increasingly, Morocco. For an examination of this phenomena in the GCC, see
Anoushiravan Ehteshami’s article in this volume, as well as the chapter by
Naomi Sakr.
29 See Rodney Wilson’s chapter in this volume.
30 For an overview of ‘modernisation theory’, see P.W. Preston, Development
Theory: An Introduction, especially chapter 9.
31 Andre Gunder Frank, Capitalism and Underdevelopment in Latin America
(New York: Monthly Review Press, 1967); Fernando Henrique Cardosa and
Enzo Faleto, Dependency and Development in Latin America (Berkeley:
University of California Press, 1973); also see work by Peter Evans, Gary
Gereffi and Guillermo O’Donnell.
32 An extensive body of literature exists on this subject matter. See Fred Halliday,
Islam and the Myth of Confrontation: Religion and Politics in the Middle East
(London: I.B. Tauris, 1996); Fred Halliday, Nation and Religion in the Middle
East (London: Saqi, 2000); Olivier Roy, The Failure of Political Islam
(Cambridge, Mass.: Harvard University Press, 1994); John Esposito, Islam and
Politics (Syracuse, NY: Syracuse University Press, 1984); John Esposito and
John O. Voll, Islam and Democracy (New York: Oxford University Press,
1996); John Esposito (ed.), Voices of Resurgent Islam (New York: Oxford
University Press, 1983); John Esposito, Islam: The Straight Path (New York:
Oxford University Press, 1988).
33 See the texts cited in Note 32.
34 For a treatment of women’s issues, see Nadje Al-Ali, Secularism, Gender and
the State in the Middle East: The Egyptian Woman’s Movement (Cambridge:
Cambridge University Press, 2000); Mai Yamani, Changed Identities: The
Challenge of the New Generation in Saudi Arabia (London: Royal Institute of
International Affairs, 2000); Lawyers Committee for Human Rights, Islam and
Equality: Debating the Future of Women and Minority Rights in the Middle
East and North Africa (New York: Lawyers Committee for Human Rights,
1999); Fatma M. Gocek and Shiva Balaghi (eds) Reconstructing Gender in the
Middle East: Tradition, Identity, and Power (New York: Columbia University
Press, 1994); Lila Abu-Lughod (ed.) Remaking Women: Feminism and
Modernity in the Middle East (Princeton: Princeton University Press, 1998).
2
The states of the Gulf
Co-operation Council
Neil Quilliam
Introduction
This chapter has been designed to familiarise the reader with the ‘dynamics
of change’ taking place within the six GCC states. Both Najem (Chapter 1)
and Ehteshami (Chapter 3) allude to the various forces that have compelled
the GCC leadership to steer their states towards gradual reform. The fall-out
from the 11 September attacks upon state–society relations in the GCC states
has yet to fully realised. As Najem notes, state-led reform, once an anathema
to ‘reform architects’, does provide an element of solace and comfort to GCC
leaders and the supporters of the US alliance against terrorism. The critical
question for this study is whether the reforms implemented to date can be
undone, if necessary. Or has the reform process reached a no-turning point,
as Ehteshami hints in his introduction. Alternatively, the subsequent drop in
the price of oil could diminish the political leverage of the ruling families
and act as a fillip to political reform. The reform process in the GCC states,
as suggested by Najem and Ehteshami, is sensitive to a more complex range
of variables than most regions of the world, and the impact of the war against
terrorism has not been lost on decision-makers, analysts and terrorists.
However, it is not my intention to evaluate the fall-out mentioned above,
but to provide an information foundation for the remainder of this book. I have
chosen to highlight the principal political reforms undertaken by the GCC
states over the past decade or so as a means of sharpening the focus of the
‘good governance’ debate. As Najem argues, the good governance debate
has been coloured and discoloured by analysts and practitioners since its
inception, and its close association with ‘cultural imperialism’ has given it an
unsavoury aftertaste. I do not wish to add to this discussion, but I have chosen
to focus upon the political reform elements of good governance rather than
macroeconomic indicators. Put simply, the fiscal crises of the rentier
economies coupled with crises of legitimacy have compelled the GCC
leadership to address the reality of demographic trends and the distance it
places between ruler and the ruled.
30 Neil Quilliam
By reviewing the political developments taking place in the GCC states, I
have not sought to analyse the processes taking place, but simply to reflect
the ‘hard facts’. The former has been left to following chapters. Henceforth,
I wish to freeze-frame each state within the good governance lens with a
reflection upon their political context, political opposition, political reform,
foreign policy and demography. I would like to contextualise Ehteshami’s
optimism for the enduring quality of the political and economic reforms
taking place within the GCC states before subscribing whole-heartedly to his
argument.
The GCC
The six Gulf states, Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United
Arab Emirates (UAE), decided to establish the Gulf Co-operation Council
(GCC) in May 1981, and the decision was ratified by the heads of those states
in Abu Dhabi on 26 May 1981. This move was considered to be a response
to the historic, geographic, economic, cultural, political and strategic realities
of the Gulf. The GCC was principally designed to protect the stability,
security and progress of the region.1 The ‘Working Paper for Joint Gulf
Action’ stated the following:
The GCC shall attempt to provide the peoples of the region with real and
continuous growth, while at the same time it shall strive to protect peace,
security and progress. The basic issue is how to transform the oilgenerated wealth into comprehensive and steady growth for the welfare
of the people of the region.2
The process through which the states of the GCC passed to reach this
agreement has been extensively covered elsewhere. I do not wish to dwell
upon this process or simply repeat the history of the GCC’s formation. It is
my intention, therefore, to offer a brief overview of the six Gulf states that
constitute the GCC, with a particular reference to the ‘sensitivities’ of good
governance. I have sought to portray the states in a most economical sense,
focusing on context, reforms, foreign relations and demography. In doing so,
I aim to sensitise the reader to the mixed bag of ‘good governance’ issues
pertinent to the Gulf states. I simply aim to provide an entrée for the following
chapters, which are dedicated to the specifics of good governance.
The GCC was formed against the backdrop of the Iranian revolution and
the Soviet invasion of Afghanistan. It represented a moment when the leaders
of the region’s monarchies recognised their mutual vulnerabilities and
realised the comfort offered by their mutual interests. The forging of the GCC,
therefore, was catalysed by the heat of regional turmoil and the uncertainty
The states of the Gulf Co-operation Council 31
of Iranian and Iraqi ambitions. The extent to which the interplay of economic,
social and security factors propelled the states to enjoin the GCC generated
some debate during the 1980s, but I do not wish to contemplate these
underlying reasons either. Quite simply, the six states of the GCC share a
complementarity of vulnerabilities and interests. For instance, they are mostly
resource-rich (excluding Bahrain) and population-poor. They are governed
by established monarchies, but are subject to challenges both democratic and
non-democratic. They are Western-oriented in security matters, and Easternoriented in issues of governance and legitimacy. This final dichotomy, of
course, is not so clear, and it allows us to peer into the world of Gulf
governance through the lens of good governance.
It is striking how the political systems in each state are similar in nature.
However, the forces that are pushing for change within each system are quite
different. Each state has been governed by stable ruling families, although
some successions have been brought about by palace coups. The modernisation process, nonetheless, has served to embolden a growing business elite,
which has come to enjoy a substantial share in the national economy. And
in some cases, this has led to demands for greater political participation in
addition to the accumulation of wealth and privileges.
The legitimacy of the ruling families has more often than not been based
upon their ability to bestow favours, both economic and social, upon key
members in society. The foundation of legitimacy has also been built upon
the Islamic credentials of the ruling family and their adherence to Islamic
law. In both cases, the essence of legitimacy has been seen to waver in the
past ten years, as the financial and religious monopolies held by the families
have diminished in real terms. This alone has placed a major challenge before
the governments of the GCC states; how can the ruling families sustain their
custodianship of their people without the financial or religious endowment
of the immediate past?
Piecemeal economic and political reforms have been introduced, to varying
degrees, within the GCC states over the past ten years, as a means of meeting
the challenge mentioned above. The smaller states have opted for slightly
more radical changes to accommodate the new economic and political
environment we might call globalisation. Qatar, for example, has tried to
reposition and redefine itself within the Gulf. More significantly, Bahrain
became a constitutional monarchy on 14 February 2002 and formally adopted
a National Charter. Saudi Arabia, on the other hand, introduced the Basic
Law in 1992 as a way of satisfying the liberal and Islamist elements within
Saudi society.
Although the states of the GCC do differ in physical size, resource
allocation, population and strategic relevance, they are united in their trepidation from their larger neighbours, Iraq and Iran. Moreover, each state is
32 Neil Quilliam
challenged by a common set of factors, and they can be summarised as the
following: the principle of succession; dependency upon single crop
economies (excepting Bahrain); poverty-induced calls for reforms; Islamist
calls for reforms; middle-class calls for reforms; high birth rates; dependency
upon expatriate labour; dependency upon external powers for security; and
a fluctuating oil price.
A brief synopsis of each state will provide us with a platform from which
we can examine the issues of good governance more fully in the forthcoming
chapters.
Bahrain
Political context
Since the eighteenth century, Bahrain has been governed by one ruling family,
the Al-Khalifa, which traces its roots back to Kuwait. Bahrain gained its
strategic prominence during the nineteenth century, when it was designated
as the British Empire’s political headquarters in the Gulf. British rule ended
in August 1971 when Bahrain was granted formal independence.3
After the withdrawal of the British, the late Sheikh Isa took the title of emir
upon himself, and Sheikh Khalifa, his brother, was appointed prime minister.
Subsequently, a Constituent Assembly was created in 1971; twenty-two
members from a chamber of thirty were elected exclusively by male voters.
The following constitution, drafted in June 1973, made provision for the
establishment of political parties and independent trade unions. Elections to
the National Assembly were conducted in December 1973, whereupon thirty
members of the forty-four-seat assembly were elected by male franchise.4
This smooth transition, and apparent empowerment of the male constituency, however, was disrupted when the government dragged its heels
over trade union legislation. The industrial unrest threatened the integrity of
the oil industry and presented the government with its first domestic
challenge. The mechanisms for managing state–society relations were pushed
aside, as the government resorted to coercion. Moreover, in October 1974,
the government introduced a state security law that enabled the security forces
to suppress subversive activities. This precipitated a confrontation between
the government and the assembly, which culminated in the dissolution of the
assembly on 26 August 1975. Furthermore, articles in the constitution relating
to civil liberties and the assembly’s re-election were suspended.5
This state of affairs lasted until December 1992, whereupon Sheikh Isa
announced the establishment of a new, thirty-member, government-appointed
Consultative Council (Majlis al-Shura). The Majlis al-Shura had been
designed to consider and contemplate the merits of legislation already passed
The states of the Gulf Co-operation Council 33
by the government, and this fell short of the demands of the opposition. The
opposition demanded the restoration of the National Assembly, the reinstatement of the constitution, repeal of the state security law and the pardoning of
all political prisoners and exiles.
This second stand-off culminated in a series of anti-government protests
in December 1994. Sheikh Salman, a popular Shi‘a cleric, condemned the
government’s actions and urged the opposition to sign a petition demanding
the restoration of the National Assembly. Despite familiar characterisations
of Shi‘a unrest in Bahrain, it was estimated that at least 25,000 signatures
were gathered, from both Shi‘a and Sunni communities. The government
resisted popular demands and, instead, arrested all Shi‘a leaders who had
sponsored the petition, including Sheikh Abdel-Amir al-Jamri, a member of
the dissolved National Assembly. Sheikh Salman was arrested and then
deported. Additionally, the government dismissed a number of Sunni leaders,
who had signed the petition, from government jobs.6
During August 1995, a series of ‘backdoor’ discussions took place between
the detained leaders and Ian Henderson, the security chief. A modus vivendi
was arrived at, where the government agreed to release opposition leaders and
most detainees in return for quelling the demonstrations. Sheikh al-Jamri
and other detainees were released in phases throughout the autumn of 1995.
Nevertheless, the government did not release all the remaining detainees;
thus Sheikh al-Jamri and five of his associates began a ten-day hunger strike
in late October.
The government responded by re-arresting Sheikh al-Jamri, which resulted
in a series of small bomb attacks throughout the following months. In an
attempt to resolve the crisis, Sheikh Isa increased the membership of the
Consultative Council from thirty to forty. Once again, the government had
failed to meet the basic demands of the opposition. Amidst this political
turmoil, Sheikh Hamad, the crown prince, sought to reach a negotiated
settlement with members of the Bahrain Freedom Movement (BFM), which
was based in London. This initiative was shelved in November 1997, as eight
members of the BFM were sentenced to five to fifteen years imprisonment.
Meanwhile, the government suppressed all public manifestations of dissent
with a series of crackdowns in 1998.7
The glimpses of good governance, which had been present during the
first years of Bahrain’s independence, rescinded into the background, as
the government sought to rule by authority rather than consultation. The
succession of Sheikh Hamad bin Isa Al-Khalifa, who succeeded his father,
in March 1999 upon the latter’s death, has heralded a new era in Bahrain’s
political and social development.
34 Neil Quilliam
Political opposition
From the above account, one can see that the opposition to the current regime
emerged in the mid-1970s. Its political leadership is commonly referred to as
the BFM, and this acts as an umbrella group for numerous elements of the
opposition. The BFM, however, exists in exile, and remains somewhat
dislocated from the ‘home opposition’. The fashion to juxtapose the majority
Shi‘a community with the ruling Sunni minority has most probably overemphasised the sectarian nature of the opposition in the past. One can easily
recognise the unity in demands for greater political reform and economic
inclusion in the policies of the state from both communities.
Political reform
Sheikh Hamad’s ascension to power in March 1999 led to a new dialogue
between the state and opposition. Bahrain was caught up in the theatre of the
absurd during Sheikh Hamad’s first few months of office, as the BFM called
for the suspension of protests as a sign of goodwill and the government
released 300 jailed political activists the following May. As part of the political
theatre, the state security court dismissed these gestures and sentenced Sheikh
al-Jamri to fifteen years imprisonment, with a fine of US$13,300 and another
fine designed to recover damages caused during the unrest. Within 24 hours,
however, Sheikh Hamad dismissed the charges and ordered the release of
Sheikh al-Jamri.
The process of political reform had gained momentum by September 2000,
as Sheikh Hamad appointed new members to the Consultative Council, which
included four women. In his address to the Council, in its opening session,
Sheikh Hamad called for a new national ‘dialogue’ over the constitution. The
tenets of good governance were beginning to re-emerge, and in December
2000 a committee was appointed to assist in drafting a National Action Charter.
The National Action Charter allows for the restructuring of the political
system with a constitutional monarchy, an elected parliament and an
appointed advisory council. As part of the reform process, the government
announced that legislative powers would be restricted to the elected body. As
a means of inclusion, Sheikh Hamad called for a public referendum on the
content of the Charter, and some 217,000 Bahrainis, male and female over
the age of 21, endorsed the Charter with an approval of 98.4 per cent of the
electorate between 14 and 15 February 2001. In accordance with the new
political environment, Sheikh Hamad pardoned all political prisoners. As
a result, local opposition leaders endorsed the Charter and urged their
supporters to approve it. The next parliamentary election is due to be held in
2004, although the opposition has requested that the date be brought forward.
The states of the Gulf Co-operation Council 35
Another significant step in the political reform process was undertaken in
February 2001 when the state security law was abolished. This marked a
structural turning point in state–society relations. Accompanying this decision
was the move to create a human rights commission within the Consultative
Council. It was created to investigate human rights abuses; furthermore,
Amnesty International was also permitted to visit Bahrain for the first time
in 1999.8
Kingdom of Bahrain
On the first anniversary of the referendum on Bahrain’s National Action
Charter, which promised political and social reform in a move towards
democracy, the emir signed into law constitutional amendments. These
constitute part of sweeping plans for political and social reform in a move
towards democracy. In a ceremony broadcast live on national television,
Justice Minister Sheikh Abdallah Bin-Khalid Al-Khalifah said that the emir,
Sheikh Hamad bin Isa Al-Khalifah, had now become king of the Kingdom
of Bahrain. Addressing the ceremony at Al-Rafah Palace in the capital
Manama, the new king announced that local municipal elections would be
held on 9 May and parliamentary elections on 24 October, the country’s first
in twenty-seven years. For the first time women will be able to run for office
in the island state.
Foreign policy
Bahrain’s foreign policy preoccupations have revolved around its dispute
with Qatar, and its continuing relations with the US and Britain. Its proximity
to Saudi Arabia has ensured that Saudi and Bahraini interests are deeply
interdependent.
Despite their membership of the GCC, both Bahrain and Qatar have been
engaged in a fairly bitter competition since independence. Their disputes
have arisen over two sensitive issues, namely, sovereignty of the Lower
Hawar islands, and the most recent palace coup in Qatar.
Qatar lodged a claim against Bahrain’s de jure control of the islands with
the International Court of Justice (ICJ) in 1991, and, at first, Bahrain contested
the legitimacy of ICJ jurisdiction.9 The dispute was successfully resolved in
March 2001 and was believed to have satisfied the needs and position of both
Qatar and Bahrain. Bahrain was awarded sovereignty over Hawar Island and
Qatar gained sovereignty over Zubarah. The peaceful resolution of this source
of tension has started to clear the pathway for more convivial relations.10
Prior to the succession of Sheikh Hamad bin Isa Al-Khalifa, in March 1999,
relations between Bahrain and Qatar had deteriorated substantially. Bahrain’s
36 Neil Quilliam
declared support for the deposed emir of Qatar, Khalifa bin Hamad Al-Thani
(see Qatar below), soured relations considerably, and Qatar responded by
awarding airtime to Bahraini opposition leaders on its Al-Jazeera channel.
Both states engaged in ‘tit-for-tat’ tactics, as Bahrain elected to boycott the
GCC summit in Doha in 1996; this act alone constituted the first boycott of
a GCC summit by a member state.11
In a move designed to improve relations, Sheikh Hamad bin Khalifa AlThani, the Qatari leader, visited Bahrain in late 1999. During his visit, the two
countries agreed to exchange ambassadors for the first time. In turn, Bahrain’s
emir paid a visit to Qatar in early 2000. The tensions between the two states,
however, remained as they engaged in another round of quid pro quo when
Bahrain’s emir boycotted the Organisation of Islamic Conference (OIC)
summit in Doha, November 1997. It connoted a sign of protest at Qatar’s
insistence on resolving the border dispute through the ICJ. The resolution of
this dispute, as noted above, has provided time and space for political
reparations to take place.
THE WEST
Bahrain has pursued a pro-Western foreign policy since it gained
independence. It has retained close links with Britain and has developed close
military and political ties with the US. As a testament to this, the US Gulf
naval force is headquartered on the outskirts of Manama, and the two
countries have been signatories to a defence accord since 1991.12
Concomitant with contemporary sensitivities, the US’s policy towards Iraq
has generated tension between the two countries. Bahraini–British relations,
however, have proven to be durable, although Britain’s refusal to expel the
BFM from London has been the cause for some concern for Bahraini officials.
The political reforms taking place within Bahrain, as noted above, have
lessened the relevance of this source of angst. Being nothing more than a
passing irritant, the two countries signed a new defence accord in 2000 in
order to strengthen military co-operation.
Demography
According to national estimates, Bahrain’s total population stood at 690,819
in 2000, of whom 60 per cent (414,126) were Bahraini nationals. The rest of
the population were expatriate workers (mostly from Asia), who constituted
nearly 60 per cent of the economically active population. Although high by
international standards, the figure is low compared to other Gulf Arab states,
where nationals usually amount to a minority. Bahraini citizens are mostly
Arab, although a significant minority are of Persian origin. The population
The states of the Gulf Co-operation Council 37
comprises 85 per cent Muslim, with two-thirds Shi‘a, and one-third Sunni.
The remaining 15 per cent are indigenous Christian, Jewish, Hindu and
Persian minorities.
Total population growth rates were generally high throughout the 1980s
and 1990s, reaching a peak of 7.3 per cent in 1986, before dropping to 3.8 per
cent in 1993 and to 3.6 per cent in 2000. Most of this growth, however, came
from the steady rise in expatriate workers. The population is highly urbanised,
with some 90 per cent living in towns or cities, and nearly 45 per cent of the
population living in the capital, Manama, and on the second main island,
Muharraq. The UN estimates that 30 per cent of the population are under the
age of 15;13 however, official estimates put this figure at 40 per cent, and 3.3
per cent over 65 years.14
Saudi Arabia
Political context
Saudi Arabia’s reconstitution began in 1902, with the recapture of Riyadh by
Abdel-Aziz bin Abdel-Rahman, ‘Ibn Saud’, from the Al-Rashid. In 1932,
Ibn Saud declared himself King of Saudi Arabia. The core of the new state
was the Al-Saud family; however, the ruling family established close ties
with other tribal and religious forces, mainly the Ikhwan and the merchant
classes of Jeddah.15
The current King, Fahd bin Abdel-Aziz Al-Saud, who is a descendent
of Ibn Saud, acceded to the throne in June 1982. He heads the Council of
Ministers, which was originally established in 1953, and holds the post
of prime minister. Council members are either chosen from the royal family
(or related families) or from an emerging coterie of technocrats. Although the
Council is invested with both legislative and executive powers, it requires
the king’s approval before authorising or implementing policies.16
The leading political force in the country is the Al-Saud family. With its
multiple branches, the royal household is thought to number more than
20,000. The rule of the country by the royal family has been compared
to that of a fully functioning political party. However, relations within
the ruling family itself have been marked by rivalries over succession.
The so-called Sudairi Seven, the full brothers of King Fahd – Sultan,
Abdel-Rahman, Nayef, Turki, Salman and Ahmed – all hold positions of
considerable power.
Crown Prince Abdullah, the de facto ruler and first in line for succession,
has no full brothers. Within this family context, Abdullah is weakened visà-vis the Sudairi Seven. Consequently, he has formed alliances with his other
half-brothers, the sons of Ibn Saud. Crown Prince Abdullah’s position is
38 Neil Quilliam
emboldened, however, through his position as commander of the National
Guard, deputy prime minister, and more controversially, as most popular
royal member. Abdullah has a populist reputation as a man of integrity, piety
and as a devotee to Arab nationalism.17
Although Saudi Arabia remains an absolute monarchy, the ruling family
tries to govern by consensus. This does not mean governing by democracy,
but by home-grown methods of consultation. For instance, the Basic Law
gives privilege to the traditional institution of informal consultative gatherings
between the king and his citizens. Upward communications tend to operate
along informal settings, as there is no franchise, political parties are disallowed and the domestic media remains muted. Recent changes, wrought by
the Gulf War and the fluctuation of the oil price, have compelled the ruling
family to accommodate the voices of opposition, which have begun to arise
from different, often competing, elements of Saudi society. As a consequence,
the death knell of the ruling family has been wrung once again.
The West’s infatuation with the issue of succession has yielded few insights
into the Saudi succession. According to common understanding, the throne
passes from brother to brother among the sons of Ibn Saud. The next in line
to the throne is Crown Prince Abdullah, despite his own advanced age and
being only half-brother to King Fahd. One can only speculate upon the postAbdullah scenario, but it is of little value here. Nonetheless, the ‘royal grab’
for power, if little understood or anticipated, should not be dismissed when
considering the stability of Saudi Arabia.
Political opposition
As noted elsewhere, the history of the Al-Saud and the Al-Sheikh has been
more or less harmoniously intertwined since the eighteenth century. Since
then, the Al-Saud have sought divine legitimacy for their policies through the
emerging religious establishment. In contemporary times, the balance
of power, and the level of interdependence between the royal family and
the ‘ulama, has fluctuated according to two critical factors: the religiosity
of the decision-making process and the perceived depth of poverty embracing
the Kingdom. In the past, the ‘ulama supplied the royal family with a steady
flow of legitimacy, especially where decisions relating to the regional
environment were paramount. The support for Iraq in its war with Iran, for
instance, was comfortably posited as a theological struggle rather than a
strategic one. The decision to allow foreign troops into Saudi Arabia during
the Gulf War, and beyond that, has, to a large extent, ruptured the legitimacy
of the ruling family and fractured the integrity of the religious establishment.
This has given rise to a burgeoning Islamist opposition that challenges
the religious monopoly held by the Al-Saud and the establishment, and the
The states of the Gulf Co-operation Council 39
economic spoils of the 1970s, which lubricated the daily lives of most Saudis,
have started to drain away.
Nevertheless, Saudi Arabia’s contemporary government enlists the support
of the religious establishment when taking major policy decisions, as a means
of co-opting the ‘ulama and keeping the more radical clergy in check. The
Islamist opposition, though pervasive and not publicly documented, is
considered to constitute the most significant powerful threat to the ruling
family.
Due to the paucity of hard data and reliable sources, research on Saudi
Arabia tends to lend credence to patterns of signs and symbols. A number of
incidents over the past twenty years or so have provided rare moments when
the activities of unofficial opponents of the regime can be recorded and
analysed. Signs of discontent with the Saudi authorities were highlighted
when 250 armed followers of Al-Oteibi seized the Grand Mosque in Mecca
in November 1979; this action alone attested to the underlying tensions
existing between state and society.18
In November 1995, a car bomb exploded in a military communications
centre in Riyadh used by US military advisers to the National Guard, killing
seven people. The four Saudi citizens, who confessed their actions on
television, were publicly executed in May 1996. A second car bombing
followed in June 1996 at the air base in al-Khobar, near Dhahran in the Eastern
Province. During this attack, nineteen US servicemen were killed and sixtyfour others were seriously injured. Both incidents targeted the US military
presence in the Saudi Kingdom, and Afghan returnees were suspected of
perpetrating the bombings.19
SHI‘A MINORITY
Despite belonging to the resource-rich area of al-Hasa, in the Eastern
Province, and constituting the majority community in this region, the Shi‘a
community of Saudi Arabia has largely been excluded from enjoying the
fruits of the oil age. One can account for this policy of exclusion in two ways:
the theological tensions between the majority Sunni and the minority Shi‘a;
and the influence of Iranian-backed initiatives amongst Shi‘a dissidents in
Saudi Arabia and the Gulf Arab states.
In October 1993, the Saudi government agreed with Shi‘a community
leaders to grant more civil liberties and address outstanding grievances about
discrimination in return for the cessation of hostilities both outside and inside
the Kingdom. The agreement, however, was not sufficiently upheld, as Shi‘a
clerics inside the Kingdom, known as the ‘Grouping of the ‘Ulama’, demanded
the release of Hashem Mohammed al-Shakhs, and twenty-three other Shi‘a
clergy detained by the Saudi authorities after the June 1996 bombing.20
40 Neil Quilliam
THE LIBERALS
The main advocates of liberal reform in the Kingdom are thought to be the
Western-educated businessmen, who try to circumvent the loopholes of
bureaucracy and avoid the intrusive behaviour of the mutawaeen (religious
police). Unlike the Islamists, they do not seek a confrontation with the
government. Moreover, they seek accommodation with prevailing system
and push for piecemeal reforms. The business elite have benefited enormously
from their role as facilitators of the national economy, and this has essentially
compromised their concerns for political reform.21
Political reform
After the Gulf War, Saudi Arabia embarked on a reform programme designed
to meet the competing needs of the ‘ulama and the business elite. Both
groupings had presented their criticisms of the government, and despite a
series of reprisals, the government sought to reconfigure its political, religious
and economic allegiances. Thus, in March 1992, King Fahd issued three
decrees that established a Basic Law, the Consultative Council and new
regulations covering a system of regional government. The three components
did not drastically depart from Crown Prince Faisal’s ten-point programme
of 1962, but the timing was some thirty years late.
In Saudi Arabia, the Shari‘a is considered to be the only constitution and
the ultimate arbiter of government and state affairs. The Basic Law of
Government, however, is the nearest the government may come to a written
constitution. The Basic Law comprises five main chapters: System of
Government (monarchy); Features of the Saudi Family (the family is
the kernel of Saudi society); Economic Principles, Rights and Duties; the
Authorities of the State; and Financial Affairs.
The Consultative Council (Majlis al-Shura), established in 1993, is
composed of sixty members appointed by the king. The function of the
Consultative Council is essentially advisory: its decisions and recommendations are accepted only if they coincide with those of the Council of
Ministers and the king. In August 1993, King Fahd appointed the sixty
members of the first Consultative Council.22 In July 1997, he replaced half
of them, in accordance with the statute, and expanded the Council to ninety
representatives. Reflecting a slight shift in direction, the new Council included
a number of known Islamist and liberal dissidents, one member from the
Shi‘a community, but no women. The majority of the members remain current
or former senior government officials and highly educated individuals closely
associated with tribal leaders.
The states of the Gulf Co-operation Council 41
Foreign policy
Since the 1990s, Saudi Arabia’s foreign policy has been shaped, in the main,
by two factors: the fall-out from the Gulf War, and the growing influence of
Crown Prince Abdullah on policy formulation.
Within the region, Saudi’s foreign policy has been concerned primarily
with three key regional players, Iraq, Iran and Yemen.
IRAQ
Diplomatic relations between Saudi Arabia and Iraq have been severed since
the Gulf War. The Saudi government still regards the ambitions of Saddam
Hussein as a continuing threat to its security. Moreover, the sense of betrayal
remains high amongst the decision-makers of the Kingdom, as Saudi support
for Iraq during the Iran–Iraq War was not reciprocated in kind or deed. Thus,
in January 1999 the Kingdom, for the first time, urged the Iraqi people to
overthrow the Iraqi regime.
IRAN
Throughout the 1980s, Iran was considered to be the principle threat to the
Gulf Arab states. With the conclusion of the Iran–Iraq War in 1988 and the
death of Khomeini in 1989, the prospects for a thaw in Saudi–Iranian relations
started to look possible. The Iraqi invasion of Kuwait changed the whole
complex of Gulf relations; and Iran was no longer considered to be the most
dangerous state in the region. The election and re-election of Mohammed
Khatami, in 1997 and 2001, as president of Iran, brought with it a sea-change
in mutual perceptions and policy formulations. This was symbolised by
Khatami’s ‘landmark’ visit to the Kingdom in May 1999, and by the Saudi
decision to increase Iran’s quota of pilgrims for the annual hajj (pilgrimage).
Saudi Arabia’s warming relationship with Iran has, however, alarmed the
UAE, as the implications for the sovereignty over Abu Musa and the Tunb
islands may be compromised by Saudi compliance with Iranian wishes. This
issue continues to be a moot point amongst the members of the GCC.
Saudi Arabia and Iran have scrambled for influence in the former Soviet
republics of Central Asia. The contest for spheres of influence, motivated by
both strategic and domestic factors, have meant that Saudi Arabia and Iran
have pursued their competition by proxy.
YEMEN
Relations between Saudi Arabia and Yemen were strained because of the
latter’s support of the Iraqi regime during the Gulf War. Saudi Arabia reacted
42 Neil Quilliam
by expelling all Yemenis from the Kingdom. Moreover, the unification of
Yemen in 1991, and its administering of relatively free elections in 1993,
formed a threat to the Kingdom’s undefined and disputed south-western
border. Saudi Arabia has reportedly intervened in the internal affairs of
Yemen. For instance, when the previously Marxist regime of South Yemen
tried to regain its independence in 1994, the Saudis, while officially remaining
neutral, supplied the southern rebels with support. Nevertheless, relations
with Yemen have improved since the two countries signed a memorandum
of understanding (MoU) in February 1995. Sporadic border clashes, and
Saudi interference with Yemeni domestic politics, however, have hindered
reaching a settlement of the border dispute, and negotiations continue.23
THE WEST
Saudi Arabia has depended upon the US to guarantee its security. The
apparent threats from Iraq are still perceived to be real, although the Iranian
threat is receding as the process of normalisation gains momentum. This
policy, as noted above, has created resentment within the Kingdom, and the
continuing presence of US troops on Saudi soil has become a festering issue
to Islamic sovereignty. The US’s almost unconditional support for Israel,
considered to be an affront to both Islamic and Arab sensibilities, has
produced immeasurable tension within the Kingdom. Abdullah’s distaste for
US policy towards the Palestinian issue has manifested itself in a number of
diplomatic ‘snubs’ with US and British officials.
Notwithstanding the above, US–Saudi relations are founded upon mutual
interests. The global economy and its leading engine are dependent upon
Gulf oil reserves; Saudi Arabia needs an active global economy and the
government seemingly requires protection from both internal and external
threats.24 This mutual dependency has generated an uncomfortable alliance
between states that share common economic interests, but pursue different
ideological/religious and strategic agendas. Both are interested in regional
stability, but their perceptions of stability differ in content and form.
Demography
According to the Ministry of Planning data, the population totalled 19.9m in
1999. It was estimated that Saudi nationals comprised 74.8 per cent, with
50.1 per cent male and 49.9 per cent female. Overall population growth is
estimated at 3.5 per cent a year. Although there are no official figures on the
number of Shi‘a in the Kingdom, unofficial estimates put the total at between
1.5m and 2m.
The states of the Gulf Co-operation Council 43
The Ministry of Planning figures suggest that 46 per cent of the population
were under the age of 15 years, 38 per cent were aged 15–39 years and only
16 per cent were over 40 years in 1999. This factor alone, poses a serious
challenge to the Saudi government; job creation is becoming a preoccupation
for the government, and the process of Saudisation has been initiated to
facilitate the objective. Published information on employment and wage
trends, however, are scarce, and the IMF noted in 1999 that data on labour
market developments were not available ‘pending the establishment of a
national database’.25
Kuwait
Political context
The principal families of Kuwait can be traced back to the Nejdi tribes of
central Saudi Arabia. They migrated during the seventeenth century to the
fishing, trading and pearling settlement, which came to be known as Kuwait
City. The population of Kuwait culminated with the migrations from Basra
and south-western Iran during the nineteenth century.26
During Ottoman times, Kuwait fell under the jurisdiction of the governorate of Basra. Nonetheless, the local ruler enjoyed considerable autonomy
from Basra. Kuwait entered into a treaty of protection with Britain in 1899,
which effectively gave the British Empire control over foreign affairs and
the defence of the territory. Kuwait gained its independence from Britain in
1961;27 Iraq initially refused to recognise Kuwait as an independent state.
Iraq recognised Kuwait in 1963 upon its admission to the Arab League (1961)
and the United Nations (1963).28
The heads of state in Kuwait herald from the Al-Sabah family. The
successive line of emirs descends from Mubarak al-Sabah. The current emir,
Sheikh Jaber al-Ahmed al-Jaber al-Sabah, succeeded his uncle in December
1977.29 The crown prince and heir-apparent is Sheikh Saad Abdullah alSalem al-Sabah who has been prime minister since 1977. Members of the
ruling family hold cabinet portfolios, such as the defence, interior and oil
portfolios.30
The Al-Sabah family has two branches, Al-Jaber, which includes the
current emir, and Al-Salim, of whom the crown prince is the most senior
member. As the Al-Jaber branch of the family is presently larger, its members
occupy a greater number of senior positions in government. There is some
family rivalry and intrigue between the two branches; this often surfaces in
competition over ministerial jobs and, sometimes, over policy. According
to convention, succession has tended to alternate between the two branches
of the family.31
44 Neil Quilliam
Over the past eleven years, the emir has ruled by decree. The emir
dominates the executive through the Council of Ministers, which is headed
by the prime minister, who is in turn chosen by the emir. Members of the
Council are appointed by the prime minister and crown prince. In theory,
the Parliament can also initiate legislation, but the emir’s veto can reject any
proposals from the Assembly. Conversely, laws decreed by the emir should
be ratified by the National Assembly. The rejection of Sheikh Jaber’s proposal
to enfranchise women was a case in point during spring 2001.32
A major interest group that contributed towards the domestic growth and
stability in Kuwait was the established merchant families. As long as the
ruling family provided economic space for them to conduct their business
freely, they treated the Al-Sabah as primes inter pares. The advent of oil
wealth, however, disturbed the traditional balance of power. The terms of the
relationship have subsequently been modified and the Al-Sabah has became
the most prominent family both politically and economically.33
Political opposition
Despite the absence of official political parties in Kuwait, a number of
informal groups represent collective interests. These collectivities have been
characterised as: the Sunni Islamists, which include the Islamic Constitutional
Movement and the Islamic Popular Alliance; the Shia Islamists of the Islamic
National Alliance; the Kuwait Democratic Forum, a secular political group
with liberal and Arab nationalist tendencies; and the National Democratic
Grouping. Party politics aside, the majority of deputies in the parliament run
as independents, and their tribal loyalties are still paramount within the
decision-making process.34
Political reform
The first National Assembly was elected in 1963, and in accordance with the
constitution, the Assembly sits for four-year terms. Between 1990 and 1992
the emir appointed a rubber-stamp National Council as a substitute for the
National Assembly. The government, however, was forced to reconvene the
assembly in 1992 due to domestic and external pressures.35
The fifty members of the last Assembly were elected by ‘select’ Kuwaiti
males aged over 21. The Assembly had been pressing the government for
greater transparency in financial matters. Members had also been pressing
for a more substantive role in formulating an oil policy; they wished to
scrutinise the details of future defence contracts. The Assembly has also
threatened to formally question ministers in the Parliament over a number
The states of the Gulf Co-operation Council 45
of issues. As a consequence, the cabinet was reshuffled in 1998, and the
Assembly was dissolved in May 1999.36
The emir’s grip on power, and his ability to curtail the activities of elected
and appointed councils, militates against the principles of good governance.
In some instances, the abundance of oil wealth has deprived local populations
from the more traditional methods of self-representation, and the creation of
elected and appointed chambers has placed a significant barrier between state
and society, government and governed. The political, cultural and linguistic
transition from majlis to assembly has denuded local populations from the
benefits of traditional good governance.
Foreign relations
Ironically, Kuwait was hard pushed to accept a security arrangement with
the GCC in the formative years of the Council. Kuwait’s complacency was
punished and its vulnerability was exposed with the Iraqi invasion in August
1990. Kuwait’s neighbour has since dominated its regional focus, and its
alliance with the US has been cemented with a policy to contain the ambitions
of Saddam Hussein’s Iraq.
Since the Iraqi invasion, the US and its Western allies have become the
ultimate guarantors of Kuwait security. A military umbrella, reinforced by
defence treaties with France, the UK and Russia, has been provided by the
US. American military hardware and advisers are permanently stationed in
Kuwait, and frequent military exercises involve the land, air and naval forces
of Kuwait.37
Demography
Kuwaiti nationals have constituted a minority of the population since the
1960s, with the migration of foreign labour for the oil-based development of
that decade. Figures from the Public Authority for Civil Information for end1998 indicate that the Kuwaitis amounted to 34.6 per cent of the population,
despite a population growth rate of 3.6 per cent in 1997–8. This is in contrast
to populations in Qatar and the United Arab Emirates, where expatriates
account for approximately 72 and 80 per cent of the population respectively.
The population of foreign workers was temporarily reduced after the Iraqi
invasion of Kuwait. Asian and Egyptian workers largely replaced the
Palestinian community. In line with a new policy, and in contrast to their
predecessors, dependants have not accompanied the majority of these new
immigrants.38
46 Neil Quilliam
Oman
Political context
The Al-Bu Said tribe has ruled Oman since the 1740s, and it was during the
eighteenth century that the British developed their interest in Oman, as it
offered an ideal port on route to India. The first treaty of friendship between
Oman and Britain was signed in 1798, and this was formalised in 1800 with
the presence of British representatives in Oman. Britain and Oman signed a
commercial and consular treaty in 1839, which accorded each of them mostfavoured nation status with respect to the other. This treaty was replaced in
1891 by the Treaty of Friendship, Commerce and Navigation. In the late
1800s and early 1900s several of the Al-Bu Said rulers in Muscat became
dependent on British funding, and the relationship of dependency was
fostered.39
During the 1950s, a rebellion, known the Imamate Rebellion, started in
Jebel Akhdar, in the mountainous interior of the country. The rebels sought
recognition from the Arab League, as they claimed statehood. The rebels did
succeed, however briefly, in attaining some autonomy, as they severed
communication routes between Jebel Akhdar and the capital. The rebellion
was quelled in the late 1950s with the help of British forces, whilst the Saudi
government supported the cause of the rebels.40
Meanwhile, oil was discovered in Oman in the 1950s and oil exports began
in 1967. The sultan, Said bin Taimur, proved reluctant to introduce a
modernisation programme. In a palace coup, somewhat characteristic of the
Gulf monarchies, his son, Qaboos bin Said, took over the leadership of
the country in 1970. Said bin Taimur was exiled to London, where he resided
until his death in 1972. Upon his ascension to power, Qaboos faced an armed
insurrection, led by the communist-dominated People’s Front for the
Liberation of Oman (PFLO), in the southern region of Dhofar. The rebels
were backed by the People’s Democratic Republic of Yemen (former South
Yemen). However, the UK, Jordan and Iran (under the shah) provided troops
and assistance to the Omani government and the rebels were eventually
defeated in 1975.41 Since then, the country has not experienced any major
insurrection.
Oman is an absolute hereditary monarchy, where the sultan rules by royal
decree. There is no prime minister, and the sultan holds the ministerial
portfolios of defence, foreign affairs and finance. The sultan appoints
members of the Council of Ministers. In the last cabinet reshuffle in late 1997,
the sultan brought only four new faces into the cabinet.42
The size and significance of the royal family in Oman is small compared
to the other Gulf states. Although they occupy prominent government
The states of the Gulf Co-operation Council 47
positions, their appointments do not constitute foregone conclusions. Unlike
the oil-rich states, where the leading families have managed to corner the oil
market, family connections in Oman have not translated into commercial
prosperity. The renowned commercial families of Oman gained their power
and prominence in the 1970s through exclusive agency agreements with
foreign companies.43
Political opposition
Political parties are outlawed in Oman, although certain groups do represent
interests and play an important role in articulating the needs of society through
informal networks. Tribes still form an essential part of the socio-political
structure, and the sultan balances the interests of each tribe by awarding
ministerial positions to competing tribal leaders.44
Political reforms
There were few significant political developments during the 1980s and early
1990s. In 1981, the State Consultative Council was established with the aim
of providing a limited avenue for political expression. Members of the
Council were appointed; however, the Council was not well defined and had
very limited responsibilities. In 1991, this Council was replaced by the Majlis
al-Shura.45
Oman had had no constitution until the promulgation of the Basic Law in
November 1996. The Basic Law outlines the rights and obligations of the
state and individuals. The state is obliged to provide healthcare, education and
security. Freedom of the press was curtailed by a clause stating that anything
detrimental to state security, which is not defined in the Law, is forbidden.
The Basic Law also called for the establishment of a second consultative
body to supplement the existing Majlis and in December 1997 the sultan
appointed members to the new State Council. The new Council was heavily
dominated by tribal notables and former officials and dignitaries, including
four members of the Al-Bu Said family.
Although the distinction between the Majlis and the State Council was not
specified in the Basic Law, subsequent government statements have helped
to clarify the roles of the two bodies. The State Council, as an appointed body,
focuses more on government policy-making. The Majlis, as an elected
body, is more concerned with constituency matters, and its operations concentrate on economic and development issues. It can question ministers on
economic and social policy. The selection process for the Majlis is still
evolving. The members for the first two sessions, in 1991 and 1994, were
selected by the sultan from a list of candidates nominated by prominent
48 Neil Quilliam
citizens. In 1997, the eighty-two representatives of the Majlis were elected
by 51,000 Omanis, and then hand-picked as a group of high-achievers from
those elected. The government has pledged that members of the next
Majlis will be directly elected, but there has been no indications to date that
suffrage will be extended.46
Oman has been more advanced than other Gulf states with respect to
women’s participation in the political process. In 1994, the Majlis was
increased to include women. In 1997, women ran for office and voted in the
election.
Foreign relations
After the rebellion in the south had been successfully contained, economic
development and foreign policy became a priority for the government. Oman
sought co-operation with the US by signing a facilities access agreement in
1980. The agreement allowed the US military to preposition a limited amount
of equipment in Oman. The agreement came at a crucial time for the US, as
it sought to restructure its security arrangements in the Gulf after the fall of
the shah’s regime in Iran.47
SAUDI ARABIA
Membership of the GCC does not preclude its members from engaging in
lengthy and hostile disputes over borders and sovereignty. Oman and Saudi
Arabia reached a settlement over their border dispute in 1990; both parties
were apparently satisfied with the agreement.48 However, Saudi Arabia has
questioned the border settlement between Yemen and Oman, and appears to
have done the same with the Oman–UAE settlement reached in May 1999.
YEMEN
In 1992 Oman and Yemen reached an accord that demarcated their common
border area. Oman ceded some of its territory to Yemen in an attempt to reach
a settlement. Upon signing the agreement, relations between the two countries
improved, and they agreed to construct a cross-border road.49 But Yemen and
Saudi Arabia are entangled in an ongoing border dispute. In mid-1998 the
Saudi government informed both the UN and the Arab League that it did not
accept the Omani–Yemeni border agreement. The Kingdom claimed that
some of the land involved in the border agreement included Saudi territory.50
Oman’s policy on the Middle East peace process has diverged from
that of its other Gulf Arab neighbours. After Egypt had signed the Camp
David accord with Israel, Oman did not break off relations with Cairo.51
The states of the Gulf Co-operation Council 49
Furthermore, it has entertained the notion of recognising Israel. In 1994,
Muscat was host to the Multilateral Working Group on Water Resources,
which resulted from the Arab–Israeli peace talks initiated in Madrid in 1991.
Israel opened a trade office in Oman in 1996, and Oman opened a commercial
office in Tel Aviv.52 Nevertheless, Oman froze contacts with Israel after the
deadlock in the peace process that followed the election of the Binyamin
Netanyahu as Israeli prime minister.
Demography
Like the other Gulf Arab countries, Oman has a relatively large expatriate
community. However, in Oman the number of expatriate residents has either
stagnated or declined, skewing overall population growth rate figures in recent
years. While the overall growth rate in 1998 was about 1.3 per cent, the Omani
population expanded by 3 per cent.
This high growth rate meant a rise in the young population, with nearly
47 per cent under the age of 20. Long-term unemployment is becoming a
major concern for the government because of the high population growth
rate. Currently, Omanis make up less than 70 per cent of the government
labour force, but they occupy a much smaller proportion of private-sector
jobs. Reinforcing this idea, one recognises that foreign labour tends to be
concentrated in low-skill areas, such as construction and sales, where working
hours are long and status is low.53
Qatar
Political context
The dominant family in Qatar since the mid-eighteenth century has been
the Al-Thani family, which arrived from central Arabia and prevailed in the
largest town Al-Bida from the 1860s. In a similar fashion to other Trucial
States, Abdullah bin Mohammed al-Thani signed an agreement with Britain,
in 1916, that guaranteed protection for the local ruler in return for British
control of Qatar’s defence and foreign affairs. As Britain withdrew from the
Gulf in 1971, Qatar gained its independence, and Ahmed bin Ali al-Thani
assumed the role of emir. In 1972, Sheikh Khalifa replaced his cousin Ahmed
in a palace coup. Sheikh Khalifa had been Qatar’s de facto ruler for more
than fifteen years, as he managed the major departments of state, namely,
foreign affairs, oil, finance, the police force and the secret police.54
Sheikh Khalifa’s eldest son, Crown Prince Sheikh Hamad, overthrew him
in June 1995. Sheikh Hamad staged a coup during his father’s absence in
Switzerland. He had been defence minister, chief of the armed forces, and had
50 Neil Quilliam
played a considerable role in managing the daily affairs of state. The coup was
peaceful. Nevertheless, Sheikh Khalifa threatened to stage a counter-coup
and quickly paid homage to the member states of the GCC, except Oman.
Lacking support, Sheikh Khalifa failed to initiate a successful counter-coup,
and in February 1996 he took up residence in neighbouring Abu Dhabi.55
Saudi Arabia, Abu Dhabi and Bahrain eventually withdrew their support
for Sheikh Khalifa, and in mid-1998 father and son agreed upon an undisclosed annual stipend in return for acquiescing to the new state of affairs.
Sheikh Hamad pardoned thirty-three Qataris found guilty of involvement in
the counter-coup, and Sheikh Khalifa was allowed to return home without
political office.56
Political reform
Sheikh Hamad’s ascension to power has been accompanied with a series of
political reforms, which seem to belie the pace of reform in the other GCC
states. In March 1999, for instance, Qatar held its first nationwide elections
to the central municipal council where both men and women were allowed
to stand for office and vote. In mid-1999, a constituent assembly was
established to draft a permanent constitution. The media was also granted an
unprecedented amount of freedom, and the Al-Jazeera satellite channel
became a beacon of debate within the Arab world.
In spite of these apparent radical political reforms, Sheikh Hamad, and his
close advisors, are still vested with primary powers. For example, the
municipal council is not invested with the authority to pass civic laws, and
can be dissolved at the discretion of the minister of municipal affairs. And
although the Consultative Council (Majlis al-Shura), whose thirty-five
members are appointed, can scrutinise policy, ministers and make recommendations to the Council of Ministers, it has no legislative power.
In an attempt to modernise the political system, Sheikh Hamad has started
to separate the powers of the royal family from the cabinet; accordingly, the
prime minister’s office is now officially separate from the royal court.
However, the cabinet is still dominated by Al-Thani family, and the prime
minister is a member of the Al-Thani family.57
Foreign policy
Qatar had long been considered a backwater in the Gulf region. Since 1995,
Qatar has pursued an independent foreign policy, and has started to ‘punch
above its weight’ within the Gulf. One manifestation of this has been a
strengthening of relations with Iran and the restoration of diplomatic ties with
Iraq. Conversely, Qatar has also been ahead of other Gulf states in establishing
The states of the Gulf Co-operation Council 51
commercial links with Israel. This factor has receded in relevance since the
outbreak of the second intifada in October 2000 and the election of Ariel
Sharon as prime minister of Israel in May 2001.
Due to its independent foreign policy, Qatar has been periodically shunned
by its GCC partners at regional and international events, such as the 1997
Middle East and North Africa economic conference in Doha, which was
boycotted by leading Arab states.
Nonetheless, Qatar has followed a ‘pro-active’ foreign policy over the last
eighteen months, and has managed to enjoy normal relations with Saudi Arabia
and the UAE again. It has also maintained close ties with Oman and good
relations with Kuwait. The convening of the WTO ministerial meeting in
November 2001 represented a major ‘coup’ for Qatar, although many globalists
accused the WTO of conducting its ‘liberalising’ business within an illiberal
state. World attention was focused on Qatar during the two-day meeting.58
BAHRAIN
The state of relations between Qatar and Bahrain improved after the new
generation of emirs signed a protocol of normalisation in December 1999. The
protocol resulted in the normalisation of political and economic relations
between the two countries despite their on-going dispute over territory (see
above).
THE WEST
Qatar’s relations with Iran and constituent members of the Organisation of
Islamic Conference (OIC) were strengthened after it hosted the OIC summit
in November 2000. Thereupon, Qatar actively sought a role as mediator in
the multiple regional disputes including Iraq and Kuwait, Iran and Iraq, and
Iran and the UAE. Qatar’s active foreign policy was underpinned by its
confidence as a pioneering commercial and strategic player in the Gulf.
Whilst elevating its regional status through proactive diplomacy and
domestic reform, Qatar’s security interests, like other members of the GCC,
remain dependent upon the US, Britain and France. The US has positioned
heavy military equipment in Qatar sufficient to equip a full US armoured
brigade, and a Qatari airbase is the launch site for US air expeditionary forces
in the Gulf.59
Demography
Qatar’s total population, including expatriates, has risen dramatically since
late 1960s, from 70,000 to 522,000 according to the 1997 census. In March
52 Neil Quilliam
1999, it was estimated to have reached 566,000, of whom only 160,000 were
Qatari nationals. The remainder, nearly 70 per cent of the total population,
are expatriate workers, mostly from South Asia.
Faced with the challenge of creating local employment and reducing
current transfer payments, the government has tried to limit the number of
expatriates working in Qatar. The government was relatively successful and
IMF figures showed a 5.3 per cent decline in the population in 1998; this
success did not last long and the IMF charted a 9.3 per cent rebound in 1999,
as oil prices began to recover and economic activity picked up. The population
is disproportionately young, and the UN estimates that 27 per cent of the
population is under the age of 15.60
UAE
Political context
The United Arab Emirates (UAE) is a federation of seven Gulf sheikhdoms:
Abu Dhabi, Ajman, Dubai, Fujairah, Ras al-Khaimah, Sharjah and UmmalQaiwain.
Most UAE nationals are the descendants of two tribal groupings, the
Qawasim and the Bani Yas. These two groupings emerged as powers in
the eighteenth century. The Qawasim, mainly land and sea merchants,
predominated in what is known now as Ras al-Khaimah and Sharjah, while
the Bani Yas, who were engaged more in agricultural and pastoral activities,
resided in what is now Abu Dhabi and Dubai.61
In order to protect its ‘Jewel’, during the nineteenth century Britain
extended its influence in the Gulf through a series of truces and protectorate
agreements with individual sheikhdoms. As mentioned elsewhere, these
truces and agreements led to the emergence of the Trucial States. Their
relevance was largely strategic and their acquiescence accorded with the
broader interests of the British Empire, and its desire to secure access to India
and guarantee pirate-free passage across the Indian Ocean. Destined to neglect
in the strategic re-division of the world’s international political and economic
system, the Trucial States looked set to return to a period of conservatism,
until the discovery of oil off the coast of Abu Dhabi in 1958.62
The new-found oil wealth not only propelled the Trucial States into the
world’s emerging global economy, but it also transformed the balance of
power amongst the Trucial States themselves. For instance, Abu Dhabi
outpaced its neighbours in terms of economic development. The rulers of the
six sheikhdoms formed the UAE as a ‘loose’ federation after Britain had
announced its intention to withdraw from the region in 1968. The UAE gained
The states of the Gulf Co-operation Council 53
its independence in December 1971, and the sheikhdoms were joined by Ras
al-Khaimah, as the seventh member, in 1972.63
Between 1971 and 1996 the UAE had a provisional constitution, which had
been perpetually renewed every five years. In 1996, the constitution was made
permanent and Abu Dhabi was designated as the permanent capital of the
federation.
The state is governed by Sheikh Zayed bin Sultan al-Nahayan of Abu
Dhabi, who heads the Supreme Council of Rulers, the UAE’s highest
authority. The Supreme Council of Rulers is responsible for policy
formulation, election of the federal president and his deputy, admitting new
members to the federation, ratifying federal laws, and appointing the judges
of the Federal Supreme Court. A formal meeting is held once every year, but
informal meetings are held more frequently. The two main emirates, Abu
Dhabi and Dubai, and at least three other emirates must approve the decisions
of the Council.64
Members of the Supreme Council of Rulers comprise the ruling sheikhs
of the seven emirates. The president of the UAE is elected from amongst the
members of the Supreme Council of Rulers. Sheikh Zayed bin Sultan alNahayan of Abu Dhabi was re-elected for a sixth five-year term in December
1996. The head of state is also commander-in-chief of the armed forces. The
Supreme Council appoints the Council of Ministers and the prime minister,
who is currently Sheikh Maktoum bin Rashed al-Maktoum, the ruler of
Dubai. The ruler of Dubai has held both the vice-presidency and the post of
prime minister since 1979.
The Council of Ministers refers legislation to the Federal National Council
(FNC) for review. The forty-member FNC acts as an advisory and
consultative body and scrutinises proposed legislation. The FNC comprises
eight members from Abu Dhabi and Dubai, six from Sharjah and Ras alKhaimah, and four from Fujairah, Ajman and Umm al-Qaiwain.
The judiciary is serviced by a Federal Supreme Court, which is made up
of five judges who, at the formal request of individual emirates, preside and
adjudicate over issues arising between the individual emirates and the federal
government. The Federal Supreme Court also decides on the constitutionality
of federal laws.
In spite the separation of powers amongst the legislative, executive and
judiciary, the ruling families of the emirates, especially Abu Dhabi, preside
over the decision-making process of the UAE. Again, one can recognise the
chasm growing between the leaders and followers. The modernisation and
bureaucratisation of governance has placed a considerable distance between
government and governed, and this process of estrangement will place future
strains upon state–society relations, unless the emerging imbalance is
addressed through political and economic reform.65
54 Neil Quilliam
Political opposition
Despite potential rivalries between individual emirates and among the various
tribal groupings, the UAE leadership has a strong grip on power. There is no
organised political opposition, and the various ruling families are generally
popular.66 Like many of its Gulf neighbours, the UAE has been concerned
about the rise of Islamist militancy in the Arab world and, although the threat
has never really materialised in the UAE, the government has continued to
closely monitor the activities of Islamist activists.
The absence of an organised opposition has contributed to the UAE’s
long-standing reputation as a country with a secure environment free from
terrorism. That image was shaken slightly in February 1999, when two bombs
were discovered at two separate shopping centres frequently used by Western
residents. However, the incident had little impact on investor or tourist
confidence in the country.67
Compared with its immediate neighbours, the UAE is free from major
security threats. Domestically it has enjoyed a history of political and social
stability, and successful diplomacy on the world stage has helped to secure
its position internationally. However, there have been isolated incidents of
unrest. In 1987, a palace coup in Sharjah led to a tense stand-off between
supporters of the rival factions, although the dispute was conducted behind
closed doors.68
Foreign policy
The UAE was one of the first Arab countries to receive Iranian officials after
the 1979 Islamic revolution, and it maintained an open-door policy even after
the Iran–Iraq War started in 1980. However, the UAE did contribute to Iraq’s
war effort once Iran started to recover lost territory and made incursions into
Iraqi territory.
After the Gulf War, the UAE sought closer ties with Iran, but when Iran
seized control of Abu Musa in 1992, relations suffered a serious setback. Iran
had already exacerbated tensions when it assumed control of the smaller
islands of Greater and Lesser Tunb, and increased both its civilian and
military presence on the islands.69 Iran and the UAE have engaged in a war
of words since 1992; however, the election and re-election of Seyyed
Mohammed Khatami, in 1997 and 2001, has brought about a slight thaw in
relations. In July 2001, Rashed Abdullah al-Nuami, UAE foreign affairs
minister, made an official visit to Iran during which he met President Khatami.
Nevertheless, supported by the GCC and the Arab League, the UAE has
continued to call on Iran to resolve the dispute, either through bilateral
negotiations or through the ICJ in The Hague.70
The states of the Gulf Co-operation Council 55
IRAQ
While in no way endorsing the Iraqi president, Saddam Hussein, the UAE
government has taken a lead in trying to reintegrate the Iraqi government
with the international community. Sheikh Zayed has urged the UN to relax
its sanctions against Iraq, in order to ease the suffering of its people. Two
factors might explain the UAE’s conciliatory stance towards Iraq. First, an
isolated Iraq could be destabilising for the region and lend weight to Iranian
territorial ambitions. Second, Dubai is keen to take advantage of the trade
opportunities that will arise when sanctions are lifted. In November 1998,
ties between the UAE and Iraq were boosted when a ferry service between
Dubai and Iraq began with the approval of the UN. Relations took a further
step forward in April 2000 when the UAE reopened its embassy in Baghdad
– a move reciprocated in June 2000. The Dubai Civil Aviation Authority has
an agreement with its Iraqi counterpart to operate Baghdad airport once UN
sanctions are ended. More recently, on 17 June 2001, Iraqi and UAE officials
agreed to establish a joint company entitled the Al Aqsa Company for Trade,
Transport and Tourism.
Behind the scenes, the UAE, particularly Dubai, is preparing for renewed
commerce with Iraq once the UN sanctions are lifted, including boosting
trade volumes and playing a role in the reconstruction process. Dubai’s Port
Rashid is continuing to expand its role as a base for UN-sponsored weekly
ferry services to the Iraqi port of Umm al-Qasr, and an increasing number of
Dubai-based traders are visiting Baghdad seeking business opportunities.71
Demography
The UAE population increased by some 86 per cent between 1975 and 1980
due to the influx of foreign labour after the 1973–4 oil boom. Many of these
workers, however, left during the recession in 1982–3. The UAE Central
Bank estimated the population in 2000 to be 3.11m; it also suggested that the
average annual growth rate was approximately 5.5 per cent between 1993
and 1997. According to UN estimates, the UAE’s population will double
by 2029.
Like other GCC states, ‘Emiratisation’ – replacing the majority expatriate
workforce with UAE nationals – has been a major priority of the government.
A study by the Dubai Municipality in 2000 indicated that UAE nationals
constituted just under 10 per cent of the emirate’s workforce; other emirates
are thought to suffer from the same problem. The government, in late 1996,
employed an amnesty scheme to encourage the departure of some 200,000
immigrants who did not have valid visas. This, however, led to labour
shortages in some industries, and many of these expatriates returned through
official channels after a mandatory waiting period of six-months.
56 Neil Quilliam
Government efforts are hindered by the preference of private-sector
employers to employ expatriates in management and clerical positions
because they believe the expatriates are more disciplined, productive and
cheaper than nationals. For example, the average wage for UAE graduates is
Dh8,000 per month (US$26,150 per year), and for high-school graduates,
Dh5,000 per month, which represents double the salary of a well-qualified,
experienced employee from the Indian subcontinent or East Asia.72
Concluding remarks
From this brief sketch of the six Gulf states that comprise the GCC, one
detects the hairline fractures prevalent in the bridge between governing from
a traditional perspective and governing in accordance with democratic,
bureaucratic and institutional means. Ironically, the newer institutions of
state, emulating modern Western democratic models, have served to formally
disenfranchise the population (male) and place greater political and economic
power in the hands of the ruler and an inner circle of decision-makers. The
path to political reform, therefore, is sometimes strewn with dead-ends and
no thoroughfares. The issue of good governance, in these cases, is in danger
of being lost, as implanted political systems fail to take root and allow the
political leaders to accumulate political and economic power.
The absence of formal political parties operating within the political
systems of the GCC states denotes the lack of an institutional framework
designed to accommodate the competing interests of different socio-political
groupings. Instead, the real politiking takes place behind close doors and
sometimes prison doors. The virtual exclusion of women from the political
process, except in Qatar and Oman, continues to codify the system of
governance as deprived and unremarkable.
Our brief survey indicates that all of the GCC states are engaging in
political reforms that, in principal, accord with the tenets of good governance.
As these relatively new states seek to provide their peoples with development,
both social and political, and strive to protect peace, security and progress,
the mystique surrounding the issue of succession, albeit by palace coup,
primogeniture or alternative means, will continue to undermine the progress;
the cogency and integrity of the political systems depend upon an unknown
variable. The following chapters will shed more light on the integrity and
durability of the reform process, thus allowing us to comprehend whether the
tenets of good governance will be realised.
The states of the Gulf Co-operation Council 57
Notes
1 Emile Nakhleh, The Persian Gulf and American Policy (New York: Praeger,
1982), pp. 47–8.
2 Ibid.
3 Fred Lawson, Bahrain: The Modernization of Autocracy (Boulder: Westview
Press, 1989), pp. 27–73.
4 J.E. Peterson, ‘The Arab Gulf States: Steps towards Participation’, Washington
Paper no. 13 (New York: Washington Institute for Near Eastern Studies, 1988),
pp. 70–7.
5 Fred Lawson, Bahrain: The Modernization of Autocracy, pp. 87–91.
6 Anthony Cordesman, Bahrain, Oman, Qatar, and the UAE: Challenges to
Security (Boulder: Westview Press, 1997), pp. 52–4.
7 Economist Intelligence Unit, Bahrain, Country Profile (London: EIU, 2001).
8 Ibid.
9 Anthony Cordesman, Bahrain, Oman, Qatar, and the UAE: Challenges to
Security, pp. 45–8.
10 Economist Intelligence Unit, Bahrain, Country Report (London: EIU, 2001).
11 Anthony Cordesman, Bahrain, Oman, Qatar, and the UAE: Challenges to
Security, p. 49.
12 Ibid.
13 The UN estimate of the total population includes expatriates, most of whom are
adults.
14 Bahrain, Country Report.
15 Alexei Vassiliev, The History of Saudi Arabia, 2nd edn (London: Saqi Books,
2000); and Haifa Alangari, The Struggle for Power in Saudi Arabia: Ibn Saud,
Hussein, and Great Britain, 1914–1924 (Reading: Ithaca Press, 1998).
16 Mordechai Abir, Saudi Arabia: Government, Society and the Gulf Crisis
(London: Routledge, 1993), p. 69.
17 Michael Jansen, ‘Pressure on US’, Middle East International 655 (27 July
2001), pp. 12–13.
18 Geoffrey Simons, Saudi Arabia: The Shape of a Client Feudalism (London:
Macmillan, 1998), pp. 309–10.
19 Michael Jansen, ‘Worrying Tensions’, Middle East International 655 (27 July
2001), pp. 12–13.
20 Economist Intelligence Unit, Saudi Arabia, Country Profile (London: EIU, 2001).
21 Ibid.
22 John Bulloch, The Shura Council in Saudi Arabia, 2nd edn (London: The Gulf
Centre for Strategic Studies, 1993), pp. 3–7.
23 Geoffrey Simons, Saudi Arabia: The Shape of a Client Feudalism, pp. 274–9.
24 Parker T. Hart, Saudi Arabia and the United States: Birth of a Security
Partnership (Bloomington: Indiana University Press, 1995).
25 Saudi Arabia, Country Profile.
26 Ahmad Mustafa Abu-Hakima, The Modern History of Kuwait, 1750–1965
(London: Luzac, 1983), pp. 1–5.
27 Abdul Karim al-Dekhayel, Kuwait: Oil, State and Political Legitimation
(Reading: Ithaca, 2000), pp. 1–2.
28 Abdul-Reda Assiri, Kuwait’s Foreign Policy: City State in World Politics
(Boulder: Westview Press, 1990), pp. 19–24.
29 Jill Crystal, Kuwait: The Transformation of an Oil State (Boulder: Westview
Press, 1992), pp. 27–8.
58 Neil Quilliam
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
Abdul Karim al-Dekhayel, Kuwait: Oil, State and Political Legitimation, p. 45.
Crystal, Jill, Kuwait: The Transformation of an Oil State, pp. 93–5.
Economist Intelligence Unit, Kuwait, Country Report (London: EIU, 2001).
Jill Crystal, Oil and Politics in the Gulf: Rulers and Merchants in Kuwait and
Qatar (Cambridge: Cambridge University Press, 1990), pp. 83–94.
Mary Ann Tetreault, Politics and Society in Contemporary Kuwait (New York:
Columbia University Press, 2000), pp. 115–18.
Abdul Karim al-Dekhayel, Kuwait: Oil, State and Political Legitimation,
p. 217.
Economist Intelligence Unit, Kuwait, Country Profile (London: EIU, 2001).
Anthony Cordesman, Kuwait: Recovery and Security after the Gulf War
(Boulder: Westview Press, 1997), pp. 97–115.
Kuwait, Country Report.
J. E. Peterson, ‘Oman’s Odyssey: From Imamate to Sultanate’ in B. R. Pridham
(ed.) Oman, Economy, Society, and Strategic Developments (London: Croom
Helm, 1987), pp. 1–10.
J. E. Peterson, Oman in the Twentieth Century: Political Foundations of an
Emerging State (London: Croom Helm, 1978), pp. 180–6.
Ibid., pp. 187–93.
Economist Intelligence Unit, Oman, Country Profile (London: EIU, 1999–2000).
John Whelan, ‘Oman’s Development Strategy’, in B.R. Pridham (ed.) Oman,
Economy, Society, and Strategic Developments, p. 141.
Calvin Allen, Oman: The Modernization of the Sultanate (Boulder: Westview
Press, 1987), p. 123.
Joseph Kechichian, Oman and the World: The Emergence of an Independent
Foreign Policy (Sanata Monica: RAND, 1995), pp. 52–4.
Oman, Country Profile.
Ian Skeet, Oman: Politics and Development (Basingstoke: Macmillan, 1992),
pp. 83–90.
Ibid., pp. 90–1.
Joseph Kechichian, Oman and the World: The Emergence of an Independent
Foreign Policy, pp. 94–7.
Oman, Country Profile.
Calvin Allen, and Rigsbee Wlynn, Oman under Qaboos: From Coup to
Constitution 1970–1996, pp. 200–1.
Ibid., pp. 206–7.
Oman, Country Profile.
Jill Crystal, Oil and Politics in the Gulf: Rulers and Merchants in Kuwait and
Qatar, pp. 155–6.
Anthony Cordesman, Bahrain, Oman, Qatar, and the UAE: Challenges to
Security, pp. 228–31.
Economist Intelligence Unit, Qatar, Country Profile (London: EIU, 2001).
Ibid.
Ibid.
Anthony Cordesman, Bahrain, Oman, Qatar, and the UAE: Challenges to
Security, pp. 225–6.
Qatar, Country Profile.
Rosemarie Said Zahlan, The Origins of the United Arab Emirates: Political and
Social History of the Trucial States (London: Macmillan, 1978), pp. 1–16.
Donald Hawley, The Trucial States (London: Allen & Unwin, 1970).
The states of the Gulf Co-operation Council 59
63 Hassan Hamdan al-Alkim, The Foreign Policy of the United Arab Emirates
(London: Saqi Books, 1989), pp. 6–15.
64 Ibid., pp. 20–1.
65 Ali Mohammed Khalifa, The United Arab Emirates: Unity in Fragmentation
(Boulder: Westview Press, 1979), pp. 38–51.
66 Malcolm C. Peek, The United Arab Emirates: Venture in Unity (Boulder:
Westview Press, 1986), pp. 128–30.
67 Economist Intelligence Unit, UAE, Country Profile (London: EIU, 2001).
68 Anthony Cordesman, Bahrain, Oman, Qatar, and the UAE: Challenges to
Security, p. 308.
69 Ibid, p. 304.
70 UAE, Country Profile.
71 Ibid.
72 Ibid.
3
The politics of
participation in the oil
monarchies*
Anoushiravan Ehteshami
Introduction
Political change has been slow in coming to the Arabian Peninsula, and when
it has, this has largely been a result of uncontrollable pressures and introduced
‘from above’ – that is to say by the rulers themselves. While the oil
monarchies seem to be making concerted efforts to address administrative and
political shortcomings in their countries in response to a combination of
pressures, this is not to say that blanket change is being imposed on these
societies by outside forces. The cautionary note that Robert Stookey struck
in the early 1980s still stands: that the Arabian Peninsula,
far from being a uniform, undifferentiated region, is one of considerable
complexity, strewn with booby traps for the unwary outside policymaker.
If there is Ariadne’s thread leading through the labyrinth, it is the
determination of these various countries to decide for themselves what
is in their best interest, to set their own national goals, and to cooperate
among themselves only when they perceive it in their interest to do so.
Any program to impose external leadership must be undertaken with
extreme caution.1
Stookey wrote these words at the height of the Reaganite drive to politicise
international commerce and apply normative Western standards as the correct
yardstick by which to measure friend and foe. Reagan’s ‘corrective’ policy
was seen as both destabilising and contentious. As Stookey had suggested,
the GCC states would resist adventurism and did not rush to adopt
inappropriate economic, political, or foreign policies during the tense periods
following the 1979 Iranian revolution and the eight-year long Iran–Iraq war.
Saudi Arabia’s brand of ‘quietist diplomacy’ tended to prevail right up to the
final stages of the Iran–Iraq War.
Quietist diplomacy in the oil monarchies was the strategy not just for
foreign affairs, however, but also for coping with internal pressures. Often in
The politics of participation 61
the 1980s and 1990s struggles for reform were quietly suppressed, or were
dismissed as irrelevant to the needs of society, with little excuse or explanation. Reformist agendas were often said to be inappropriate, badly timed, or
simply too ambitious or radical. But for reasons which will become apparent,
reform is very much the new spirit of the GCC countries. Indeed, barring any
long-term negative fallout from the events of 11 September 2001 in the US,
one can afford to be somewhat more optimistic about the prospects of political
reform in the Arabian Peninsula states today than at any time since the
massive influx of oil income in the last quarter of the twentieth century.
My argument about the process of political reform in the GCC states
is based first and foremost on an analysis of the political economy of
these states. The intention is to show that in view of their grave economic
difficulties and social tensions, the GCC rulers have had little choice but
to consider the introduction of economic and political reforms. But further to
this, the impact of the changes in the international system in the closing days
of 1989 must be given some attention as well, as influential forces with a
palpable effect on the internal affairs of the oil monarchies. While it is true
that by the end of the Iran–Iraq War the region itself had begun to show
serious signs of decay, with ‘rent’ as the oxygen of the GCC economies
being cut to threatening levels, it was the sudden disruption of the bi-polar
Cold War international system which proved to be the biggest dislocating
force for regional systems in general and for the Middle East and North Africa
(MENA) region in particular. The MENA system was not immune to these
international developments. While up until that point all regional actors had
customarily set their national and international clocks by the Cold War,
virtually overnight that point of reference disappeared and most of the oil
monarchies had to quickly adjust to the impact of a new ‘democratic wave’
from Europe before an uncertain ‘New World Order’ was cast in 1991.
By the end of 1989, therefore, most GCC leaders were already speaking
of the need to consider introducing new social and political initiatives, albeit
rather half-heartedly.2 As justification for the re-assessments of their political
systems, they often pointed to the appearance of some ‘new realities’.3 These,
of course, included much publicised, unveiled criticism from unexpected
quarters at home. The impact that dramatic political developments in several
GCC countries were having on their domestic environment should not be
underestimated. As Hardy has argued, the range of reforms being raised from
Muscat to Kuwait ‘reinforced the sense that change was in the air, and that
[rulers were] having to adjust, willing or unwillingly, to new realities’.4
In addition, another critical development in the 1990s was at the leadership
level, which not only introduced new personnel at the highest levels of
decision-making in several GCC states, but actually allowed for the flourishing
of different outlooks and political priorities as well. Personnel changes at this
62 Anoushiravan Ehteshami
high level also brought changes in priorities.5 Moreover, there was the
economic impact and political aftermath of the Iraqi invasion of Kuwait in
1990 to address. This event acted as a catalyst for the examination, and eventual
introduction, of major reforms across the Arabian Peninsula. It was alongside
these domestic-driven changes that the spray from the so-called democratic
wave in eastern Europe splashed against the shores of the Middle East in the
early 1990s. Together, these forces came to leave a definite imprint on the oil
monarchies of the Middle East, forcing them to widen their policy options.
Thus, due to the unique nature of government and political authority
in these societies, where the discussion of political reform was introduced
it was very quickly and firmly tied to wider issues which are best labelled
as ‘good governance’ matters. The idea of governance carries certain
connotations in this part of the world as the very nature of ‘rulership’ is caught
up with and tied to governance issues. Here, one is dealing with a group of
family-based fiefdoms which have over a long period of time evolved into
independent countries. Traditionally, therefore, the terms of reference for
governance in the Gulf Arab monarchies has been determined by the ruling
families themselves, in whose domain political power has tended to rest.
Until recently, good governance had meant little more than a careful management of the affairs of state. Now, though, the whole process of widening
participation has been caught up with a range of ‘indicators’ associated
with ‘good governance’. Indicators include such issues as transparency,
accountability, absence of corruption and nepotism, rational and fair policymaking, in addition to such variables as efficiency and responsiveness in
the public sector, the presence of an independent judiciary which operates
(and is seen to operate) without prejudice, privacy laws and freedom of
information, burgeoning civil society institutions, and a welfare-oriented
economic system. However, even a cursory look at the Middle East in general
and the GCC states in particular will show that the region is still a long way
from meeting these criteria in full.6 But the picture is not a wholly gloomy
one, and in many respects clear progress has already been made.
The democratisation debate with regard to the oil
monarchies
Largely because of the social make-up of the Arabian Peninsula states, the
debate about democratisation, or for that matter political pluralism, had until
recently been taking place within a fairly narrow band of hypotheses and
testbeds.7 Until recently, and prior to an avalanche of criticism following
September 11 and revelations about the role played by militant Islamists from
several of the oil monarchies, one line of argument had been that as the
traditional societies of the Arabian Peninsula tend to run to a different, but
The politics of participation 63
equally effective, political clock, demanding their conformity with Westernstyle democracies is not only counterproductive but also unrewarding for
analytical purposes.8 The civil–state (people–leader) relations in these
societies are so well regulated by the entrenched traditional modes of
interaction between the rulers and the ruled that the introduction of Westernstyle competitive politics or the addition of a regular parliamentary-based
voting system could do little to improve the quality of participation and
political access in these countries, if at all, or add to the efficiency of the state
or its governing regime.9 More than twenty years after the start of the oil
boom a senior Gulf Arab official can still claim that ‘parliamentary democracy
and constitutional monarchies are Western notions which do not necessarily
apply to the Arab world in general, nor to tribal Gulf Arab societies in
particular’.10
So, when in the 1970s, President Carter realised a long-standing American
ambition by launching a democratisation crusade in the developing world,
and in the 1980s – when the Gulf region was faced with a uniquely theocratic parliamentary experiment in Iran – the often repeated view was that
democracy was an irrelevant concept in the social context of the Arabian
Peninsula. It was even said that the unmeasured introduction of democratic
norms by Western do-gooders could cause more harm, in terms of bringing
about political dislocation and serious disruption to the operationability of
these traditional allies of the West, than good. The predominant view was that,
surrounded by political uncertainty, this strategically prized part of the Middle
East should not be subject to heavy-handed Western interference; what is
quite obviously unbroken should be left alone. Sympathisers of the oil
monarchies argued that the majority of the conservative Gulf Arab countries,
recently introduced to the international system – with weak demographic and
institutional bases, and still novices at the international political game –
should be left alone to find their own models of political development and
be allowed to refine their existing rubrics for political interaction and also be
encouraged to find their own platforms for public discourse. The consultative
‘shura’ system, in other words, was said to work, and worked well enough
for it not to be supplanted or substituted by half-baked Western-type systems
of government built around an elected national assembly.
Other schools of thought begged to differ, drawing a more critical picture
of civil–state relations in the oil monarchies. Some within the radical school
even spoke of the virtues of ‘Arabia without Sultans’.11 Halliday stated with
regard to Saudi Arabia that ‘the state was founded on the most backward
ideology: unity of religion and loyalty to one family, making Saudi Arabia
the only state in the world that was titled as the property of a single dynasty’.12
These criticisms were equally applied to the other pro-Western Arabian
Peninsula countries as well.
64 Anoushiravan Ehteshami
Pointing to the ‘rentier’ nature of these societies, those of a political
economy persuasion invested in considerable analytical concepts in their
attempts to explain the endurance of patriarchal and authoritarian regimes in
the Arabian Peninsula. The classic formulation of Gulf Arab rentierism is
put forward by Giacomo Luciani, who states:
A state that economically supports society and is the main source
of private revenues through government expenditure, while in turn
supported by revenue accruing from abroad, does not need to respond to
society. On the contrary, a state that is supported by society, through
taxes levied in one form or another, will in the final analysis be obliged
to respond to societal pressure.13
The context is very clear; these oil monarchies are detached from their local
socio-economic realm by virtue of rent. They have acquired relative
autonomy from society, which gives them the ability to pursue national goals
without accountability. Chaudhry elegantly applies this thinking to Saudi
Arabia, but it can also be extended to include the other oil monarchies. She
proposes that the oil boom
created new channels through which resources circulated within the
bureaucracy, rendering extractive and regulatory agencies obsolete
and reorienting bureaus toward distributive branches of government.
Exogenous resources changed the institutional shape, organization,
and capacities of the Saudi bureaucracy, severing earlier link between
taxation and organizational change. The extractive and regulatory
branches of the bureaucracy were replaced with dozens of distributive
agencies that managed the economy through the deployment of oil
revenues.14
Another strand to the rentierism debate focused on the corrosive impact of
rent. Palmer and company argued, for instance, that rentier ‘behavioral
characteristics make it difficult for the rentier state to increase its productive
capacity and to maximise the economic and political advantages at its
disposal’.15 Beblawi, one of the main theorists of rentierism, extended the
argument to the political realm and stated that:
public goods and private favours have thus gone together in defining the
role of the [rentier] state. With virtually no taxes, citizens are far less
demanding in terms of political participation. The history of democracy
owes its beginnings . . . to some fiscal association (no taxation without
representation).16
The politics of participation 65
This feature, he said, is absent from the oil rentier states of the Persian Gulf.
As recently as the mid-1990s, Luciani was being most emphatic, arguing
that the ‘rentier nature of the state is a strong factor in discouraging
democratization in all countries that have access to oil rent, and I would be
surprised if any of the rentier states were to democratize’, but, he conceded,
the ‘presence of a fiscal crisis creates the expectation that a country may
embark on a process of democratization’.17 The links between fiscal crisis
and political reform in the oil monarchies will be discussed further below.
In the oil monarchies, social norms and relations seemed to have fallen
behind the pace of economic change, where rapid modernisation and
economic development had clearly taken hold. The questions were: why had
rapid economic development in these developing countries not led to broader
political reforms? How had the all-pervading economic earthquake not
sent shockwaves through the political structures of these countries? The
explanation focused very much on the socio-economic relationships which
oil income had nurtured, and the ways in which oil had reinforced existing
social structures and provided a buffer for the ruling families.18
The rise of the petro-dollar economic system in the early 1970s prompted
the application of complex arguments purporting to show that the massive
influx of capital resulting from rapid increases in the price of exported oil
had enabled the traditional elites of the Gulf Arab monarchies to ‘buy off’
their population, to distribute largesse, and to de-politicise them to the point
of pacifying their political instincts. This was made possible because the
ruling families spared no expense in trying to satisfy their nationals’ material
needs without additional costs to the population – in other words, without
taxing them for the privilege. The offerings included the provision of such
expensive services as health care, education from nursery to university,
subsidised housing, food, electricity, petroleum, and a wide range of other
important services, as well as a high-tech infrastructure, subsidised consumer
goods, and good prospects for employment.
The way in which the states deployed their oil windfalls, the argument
goes, not only cushioned them against political upheavals, not only did it
beholden much of the society to the elites, not only allowed the elites to
undertake a form of social engineering by creating state-reliant modern
middle classes totally dependent on the states’ largesse for their prosperity
(let alone survival), but also led to the emergence of powerful state
machineries and bureaucracies who orchestrated the states’ development.
Substantial oil-based income, thus, had brought a large degree of autonomy
to the states and their masters, allowing the elites to concentrate on the
economic development of their states and routinely ignore their populations’
political aspirations, for which they did not pay a political price or suffer a
popular backlash. This rentier bliss provided a sharp contrast to the political
66 Anoushiravan Ehteshami
ravages of neighbouring Iran and Iraq. Towards the end of the 1970s, with
neighbouring Iran in the throes of an anti-monarchical Islamic revolutionary
turmoil, proponents of the evolutionary path to change used the Iranian
experience to underline the successes of the Gulf Arab model and the ability
of its elites to manage socio-economic change within the given confines of
their ‘traditional’ societies. Ironically, up to the mid-1970s it was Iran which
had often been used as the textbook model of modernisation and development
for the other Gulf states to adopt. Iran was said to be making major strides
towards a proscribed ‘Great Civilisation’, to paraphrase the last reigning
Pahlavi monarch, while combining its traditional forms of rulership with
wholesale development of every realm and aspect of its polity.
Collective and cumulative effects of the ‘new realities’
The 1990s therefore brought with it new challenges and winds of change.
First, there was the indisputable political mark that the occupation and
subsequent efforts to liberate Kuwait from the clutches of Saddam Hussein
had left on the oil monarchies. Ten years after the shock delivered by Iran’s
Islamic revolution, President Hussein’s bold move against its smaller
neighbour deeply shocked the GCC elites and forced them to be less
complacent about political disquiet at home. In addition to the crisis’ direct
and indirect economic costs to the GCC states, the crisis also created a new
momentum for change at the popular level. The arrival of Western troops
in Saudi Arabia in 1990, for instance, galvanised both the conservative and
the liberal forces in the Kingdom. Their presence encouraged each group to
apply pressure on the House of Saud and demand changes to the ways in
which contact between the elite (and the government) and the people was
regulated. While the former group wanted an end to what they perceived to
be Westernisation and an emphatic endorsement of the traditions of the
Kingdom, the latter forces demanded more openness in the political and social
life of the country. Women getting behind the wheels of their family cars and
defiantly driving their vehicles through the streets of the Kingdom in the
autumn of 1990 was perhaps the most telling symbol of what the liberal forces
in Saudi Arabia were demanding: individual freedoms and the introduction
of a wide range of new rights.
Concomitant with the political fallout from the Kuwait crisis was the socalled fiscal crisis of the state in the oil-based economies of the GCC. Having
suffered from long-term decline in crude oil prices from the middle of the
1980s, these states were already under great fiscal pressure when the bill for
the liberation of Kuwait arrived on the desk of the richest Gulf Arab countries:
it was in excess of $200 billion. Thus, weak national finances combined with
the heavy clean-up bill of the Iraqi invasion limited the ability of these states
The politics of participation 67
to fulfil their ‘national contracts’ and shield their populations from the costs
of national development. With the ‘cushion’ increasingly threadbare, the
population began asking questions about the absence of political participation
and public consultation in the affairs of the state. Citizens in such countries
as Saudi Arabia were even more agitated when the state found little option
to its fiscal difficulties other than to pass on, through indirect taxation and a
reduction in some subsidies, some of the costs of development to the
population. In Kuwait, on the other hand, the population was more adamant
than ever that from that point on it should be involved in the shaping of the
country’s future. The Kuwaiti public wanted the unconditional reinstatement
of the national assembly. Similar signals for political change were emanating
from the other GCC countries.
Third, there was the whole ‘1990s thing’ which followed the end of the
Cold War in 1989 and the collapse of the Soviet Union in 1991. Suddenly,
and without warning, new forces of political reform were pushing outwards
from eastern Europe to articulate the mood for change demanded by Arab
citizens across the region. The demonstration effect of the transformations
sweeping across eastern Europe could not be missed. Within months of the
‘velvet revolutions’ in eastern Europe, Arab masses, from the Maghreb to
the Arabian Peninsula, were demanding an end to corruption and arbitrary
rule and the introduction of open and transparent government in their own
countries. The GCC countries were not immune to the developments in
eastern European and as their activists demanded change, so their governments responded by accelerating the pace of their proposed reforms, which
by the mid-1990s included constitutional as well legislative ones. King Fahd
of Saudi Arabia, for example, introduced the country’s new Basic Law and
its 81 articles with the announcement that the Kingdom’s sixty-man Majlis
al-Shura (whose membership had grown to ninety by the end of the 1990s)
would complement the regular open-door councils held on a daily or weekly
basis by members of the royal family and their cabinet colleagues.19
Fourth, with the patriarch gone and the war behind it, the revolutionary
country next door had begun to engage in such open public debates and
display such pluralistic features that it seemed to make the country more of
a democracy than the populist theocracy Khomeini had crafted. Far from
exporting its Islamic revolution, Tehran was now increasingly leading by
example in the arena of political reform. On the eve of the 1990s, President
Rafsanjani, who was elected to the presidency with a large popular mandate
in 1989, pushed open many doors to reform. During his two terms in office,
Rafsanjani’s efforts in improving Iran’s relations with its neighbours,
including its conservative Arab ones, was reciprocated. Indeed, the GCC
states wanted and warmly welcomed a moderate Iran, advising their citizens
that it was now time to turn a new leaf in their countries’ relations with Iran.
68 Anoushiravan Ehteshami
But when they did advocate closer ties with their northern neighbour they had
not banked on the wider regional impact of the ‘Khatami factor’ and the
ensuing political whirlwind which was about to be unleashed in that country.
Constitutionally barred from standing a third time, Rafsanjani gave way to
a very different executive leader in 1997. The new popular president,
Mohammed Khatami, who was also a cleric and a former Rafsanjani cabinet
minister, boldly began to broaden the arena of reform to include popular
appraisal of the many sacred cows of the Islamic regime and to encourage the
population as a whole to break down the barriers to the establishment of a
democratic and pluralist state in Iran – of the sort clearly recognisable as
Western in style, though may be not so entirely in content. For the GCC states,
better relations with neighbouring Iran was one thing, to then be vulnerable
to the winds of change blowing from Tehran was quite another. As a Saudi
colleague put it to me; ‘Iran’s revolution posed sort of a technical threat to
our security that we managed to contain, but whether we will be able to deflect
the power of Khatami’s movement this side of the Gulf remains to be seen.
It is hard to decide which is more dangerous and threatening, the export of
its revolution or the power of Khatami’s reforms’. It was not just the message
of his movement which was falling on receptive ears in the GCC states,
but also the manner in which he secured his victory in the May 1997 poll,
with over 25 million people cheerfully and willingly giving him a mandate
to govern.
Fifth, the GCC elites were becoming fully aware that the (slow) opening
of the political system could not only extend the rulers’ legitimacy but also
reinforce the ruling families’ leading position within society. This message
was being reinforced by two very different sets of forces in the 1990s. On
the one hand, the state was jolted into action by the need to respond to the
very vocal opposition forces in countries such as Bahrain and Saudi Arabia,
who freely utilised the world-wide-web and the internet to publicise
their cause and embarrass the governing elites. The state in these and other
GCC countries had to reaffirm its position by responding to the criticisms
tabled against it by the largely Western-based opposition groups. The state’s
response in virtually every case was to combine strongarm tactics with
announcements about new economic and political reform initiatives.
On the other hand, by proactively engaging in initiatives that signalled the
launch of serious and systematic reforms in the political arena, often
announced by members of the ruling circles themselves, the state was
showing its responsiveness and its recognition of its responsibilities to the
citizenry. As will be shown below, in the course of the 1990s the ruling family
in every GCC state attempted to deepen its commitment to the broadening of
the political base and the establishment or refinement of participatory and
representative mechanisms of the state. In some instances the elite opted to
The politics of participation 69
reform the traditional (‘authentic’) modes of participation instead of creating
new (so-called ‘alien’) representative structures, while in others the elite set
about introducing new structures and quite radical forms of participatory
systems. The Saudis introduced the national Shura, while the Emir of Bahrain
opted for wholesale reforms around the concept of a new ‘national charter’.
A further push factor in case of some of the larger GCC states was the
example being set by a united Yemen under the leadership of the traditionally
conservative North , which, albeit tortuously, was introducing a wide range
of political and social reforms aimed at preparing the country for a post-Cold
War regional and international environment.
Finally, there was the influence of the unavoidable impact of the late
twentieth century communications systems. The presence of such new
mediums as satellite television, the fax machine, the internet and the highly
accessible cellular telephone made easy job of transmitting different ideas and
information to society through channels not directly controlled or guided by
the state. The uncontainable influence of information technologies on civilstate relations was another factor pushing the GCC leaders towards considering
opening up of more of their political space to the public.
Forms of political participation in the oil monarchies
As the pace of political change has continued to accelerate in the oil
monarchies, so it is important to consider how the traditional, rentier, societies
of the Arabian Peninsula have been responding to the internal, regional and
international political challenges facing them.
Kuwait
In Kuwait, Sheikh Jaber al-Sabah had indicated even before the liberation of
his country that Kuwait was entering a new era and that elections for its
vibrant national assembly would be one of the priorities of his government.
Thus, elections for the assembly were held in 1992, 1996 and also in 1999.
The 1999 elections resulted from a direct and dramatic stand-off between
Kuwait’s vocal and politically powerful national assembly and the al-Sabahcontrolled government. The assembly’s bold move in 1998 to quiz the interior
minister for allowing the publication of material seen by the Islamists in the
assembly as contrary to Kuwaiti and Islamic cultural values caused a serious
constitutional crisis in the country, in which the assembly was said to be
testing the frontiers of its powers while the cabinet, chaired by Crown Prince
Saad (the prime minister), was hanging on to its powers and status.20 While
it was the assembly which forced the issue, it was the cabinet which found a
way out; it chose to resign en masse rather than have one of its members
70 Anoushiravan Ehteshami
thrown into the lion’s den. Sheikh Jaber had little option but to try and defuse
the crisis by dissolving the parliament and immediately announcing elections
for a new assembly. Such tensions between the assembly and the government
are now commonplace in Kuwait, with the population and the media actively
participating in the debates generated by the political openness in the country.
That the forces for change are finely balanced in Kuwait is evident from the
make-up of the 1999 assembly: on one side are the Islamists, who won twenty
seats in the 1999 elections, the ‘liberal’ group, which won sixteen, and the
pro-government (largely-tribal based) individuals who won the remaining
fourteen seats. In Kuwait’s vibrant political arena, the new members will
continue to attempt to extend their ‘supervisory’ role and challenge the
government’s monopoly on decision-making, as they did with their narrow
rejection of the emir’s decree to extend the vote to Kuwaiti women. Female
participation, as part of Kuwait’s modernisation, was proposed by Sheikh
Jaber in a decree at the time, but was rejected by a small margin by the ‘third
assembly’ elected in 1999. The Kuwaiti government’s decision in May 1999
to approve a draft law granting women full political rights for the first time
provided more evidence that the process of modernisation is not restricted
simply to that of tinkering with procedures.21
In other areas, too, the two sides are locked in battle, with the surprising
outcome that their debates actually lead to more changes, reforms, and
sometimes more freedoms in Kuwait.
Qatar
A small country with some experience of participatory politics, Qatar has
also re-entered the arena with the introduction of a number of sweeping
changes. Indeed, the reform of the political system was one of the declared
key objectives of Sheikh Hamad bin Khalifa al-Thani when he deposed his
father in 1995. Despite the existence of a constitution (drafted in 1970) and
an ‘advisory council’ to the emir, the country continued to be run by Sheikh
Khalifa and a small group of advisors and family members.22 Despite the
citizens’ relative comfort and the emir’s rather benevolent style of leadership,
by 1992 sufficient pressure had been building up in society for a group of fifty
prominent Qataris to petition the emir for the introduction of more freedoms.
Their call was answered by the emir’s son, Sheikh Hamad.
One of the first acts of the new emir was to end press censorship and to
bring under control the country’s main repressive vehicle, the Ministry of
Information. Not surprisingly then, Qatar soon announced its intention
to hold the country’s first open elections since its foundation. Its first ever
national poll in March 1999 was for the twenty-nine-member Central
Municipal Council in which female candidates were also allowed to stand.23
The politics of participation 71
Six women did so, although none were elected on this occasion. This successful event provided the first opportunity for the Qatari people to participate in
an election, which they did with great enthusiasm – voter turnout was 80 per
cent.24 Qatar, already endowed with the outspoken and critical al-Jazeera
satellite television network, was now opening a new chapter in its political
life. This election was to be the first in a cycle of national polls.
However, although they started the race, it is likely that the experience of
neighbouring Bahrain may also affect the strategy of the al-Thanis and
encourage them to take bolder steps towards political openness and voter–
leader reciprocity. It is in this light that the announced plans for other types
of elections become particularly significant, as one can envisage a situation
in which, through ‘bandwagoning’, the Gulf emirates emulate each other and
adopt some of the features of the others’ participatory mechanisms. In Qatar,
a thirty-two-member commission has already begun investigating the
mechanisms of introducing a parliamentary democracy and an elected
chamber. The introduction of these changes will of course require a new
constitution, one which is likely to contain the following features: an elected
assembly, with some legislation powers, to replace the existing Shura council;
women to be given the vote and the right to stand in elections; a fundamental
respect for human rights; and political rights for the country’s non-native
residents. In the social context of the Gulf oil monarchies, these are indeed
revolutionary changes being proposed.
Oman
In Oman, the national Shura council was established in 1991, alongside the
Majlis al-Dawla (the State Council, which acts as an ‘upper chamber’). This
Shura council was given the power to review legislation regarding culture,
education, social and economic issues, as well as the government’s development plans.25 A number of announcements and policy initiatives by the mid1990s were making clear that the elite had accepted the principle of direct
participation by the citizenry in the political life of the country. The Basic Law
of the State, codifying state–civil relations, was introduced in 1996. This law
laid down the constitutional structures of Oman and committed the sultan to
the strengthening of the consultative system. Thus, in 1998 the sultan
announced that the 2000 Shura council would be elected, albeit limited to
one-quarter of the population aged above 21. This was a milestone, as it was
the first time that the Shura members were to be elected. Perhaps more
importantly, it was also announced prior to the September poll that all future
elections would be based on the principle of universal suffrage. It is intended
that this measure will result in mass participation in national elections and
more political activity across the country. Even in the 2000 elections, one
72 Anoushiravan Ehteshami
could sense a high degree of institutionalisation of elections: the process was
referred to as intikhab (election) and not tarsheeh wa ikhtiyar (nominations
and choice); fifty appeals were lodged with the election monitoring body, all
were closely investigated, of which two resulted in further action and the
overturning of the result in the Duqum Wilyat.26
Interestingly, some 600 candidates contested the 2000 elections for the
Shura, including several female candidates. Indeed, female participation was
encouraged throughout the election process, which led to two women
candidates being elected, out of thirty-two standing.27 One of the two female
members of the Shura, the 31-year-old businesswoman Lujaina Haider
Darwish, was quick to the draw, using her new position and new voice to
challenge the limited role of the Shura and was soon calling for more decisionmaking powers to be given to the Majlis, including legislative powers and
more powers of scrutiny.28 The other female member, Raheela al-Riyami,
was elected to the Majlis’ Executive Bureau, its highest executive body. The
Shura council, through its five technical committees, is already increasingly
finding itself engaged in detailed policy-related matters with ministers and the
government administration in general. The Shura may already have begun its
march towards becoming an elected parliament with legislative powers.
Bahrain
In Bahrain, where some major changes were already in evidence in the
mid-1990s, the consultative council was established in 1993, with similar
oversight and advisory functions as its counterparts in Oman and Saudi
Arabia. Although in terms of importance and national role, the new council
was a shadow of its forerunner (the directly elected thirty-member national
assembly which was suspended in 1975), the emir chose the council as the
launching pad for a much grander scheme of reforms which were put to
the public in 2001. This move was all the more remarkable considering the
political tensions in Bahrain in the 1990s, at both the leadership level and
the street. Violent protest against the ruling establishment and human rights
abuses was mirrored in an internal power struggle between Crown Prince
Hamad and his uncle, Sheikh Khalifa. The transfer of power to Sheikh Hamad
took place in 1999 upon the death of Emir Issa. Emir Hamad has not been idle
since taking control of the reigns of power.
First came the forty-five-strong National Charter Committee (NCC), set
up in late 2000, which acted as a technical successor to the forty-member
Majlis al-Shura established by Emir Issa in 1996. Emir Hamad had already
constituted a new, more representative Majlis, in September 2000, including
four women, nineteen Shias, nineteen Sunnis, one Jew and one Christian.
The NCC, comprising a cross-section of Bahraini society, was asked to
The politics of participation 73
examine and approve the new ‘National Charter’, which was put to a
referendum in February 2001. For all its initial objections to the emir’s
conduct and plans, the London-based Bahrain Freedom Movement also
endorsed the emir’s introduction of the charter, as did other oppositionists.
As if to underline the commitments to political reforms and the establishment of a constitutional monarchy in the country, the emir declared on the
anniversary of the 2001 vote that his state would from February 2002 be
known as the Kingdom of Bahrain. The ‘establishment of constitutional
institution’, he said, ‘fulfils the pledge of reforms that was overwhelmingly
endorsed by the popular referendum on the National Action Charter’.29
Constitutional changes also allow for equal participation for women in all
local and national elections, the establishment of a constitutional court and
an independent audit bureau.
These developments in the small Persian Gulf island of Bahrain are
remarkable for a number of reasons. First, the design, debates and nature of
the introduction of the charter and the implementation of its recommendations
mark the first successful top-down execution of wide-ranging political
reforms in the GCC. In this case, the leader is himself the revolutionary agent,
rather than the protector of the status quo and of so-called ‘conservative
values’. In this regard at least, the Bahraini experience defies the conventional
wisdom about the role of Gulf leaders in their national politics.
Second, the charter itself is indeed a revolutionary document which the
emir personally championed against some stiff opposition from within
the elite itself. The charter speaks of transparency, accountability, justice,
equality amongst the sexes and ethnic/religious groups, equal opportunity
for all, respect for human rights, the establishment of an independent
judiciary, and the introduction of a new two-chamber parliamentary system.30
It was not just the content of the charter which created excitement, but the
institutionalisation of the process of reform which the emir has introduced.
In anticipation of general support for the charter, new structures were created
soon after the February referendum so as to facilitate the smooth introduction
of the reforms. Plans were put in place for local elections to take place in
2002 and for parliamentary elections in 2004.31
Third, the manner in which the charter was received by the Bahraini people
is quite encouraging. According to government data, 98.4 per cent of voters
supported the reform package. The participation rate was 82 per cent.32 There
was no violence surrounding the poll, a carnival atmosphere prevailed and the
emir spoke of the referendum marking the first concrete step towards full
democracy.
Finally, soon after the referendum, the emir underlined his commitment to
reform by abolishing both the hated state security laws and the state security
court which had been used quite extensively to suppress all opposition. The
74 Anoushiravan Ehteshami
court was replaced by a new committee chaired by the liberal-oriented crown
prince to oversee the introduction and implementation of the charter. Another
new committee was also set up to carry through the necessary amendments
to the constitution to clear the way for the restoration of parliamentary
democracy in the sheikhdom.
Saudi Arabia
In Saudi Arabia too, the one country often seen as the most conservative of
the GCC states, one also feels the winds of change blowing, more so with
every executive lever that Crown Prince Abdullah acquires. Saudi debates of
reform in the Kingdom should be seen against the backdrop of rapid social
change in the country, the dizzying pace of urbanisation and an unprecedented
expansion of the role of the al-Saud-dominated government machinery in
running the country, which has evolved into what one might call a ‘rentiercorporatist’ state. While Saudi Arabia has undergone massive social change
since the mid-1960s, the most dramatic political developments since the 1960
political challenge of the ‘Liberal Princes’ only occurred after the outbreak
of the Kuwait crisis in 1990.33 There was the unexpected protest by the more
liberal-minded Saudis, but, as Gause notes, it was the religious-based protests
which made the most direct impression on the elite.34 For a short period after
the onset of the crisis, prominent Saudi (largely religious-oriented) citizens
began to publicly petition King Fahd to extend the realm of Sharia’a law and
also introduce economic reforms. The first one came in 1991, followed by a
second petition in mid-1992. These were to be early signs of an emerging
Islamist opposition to the al-Sauds, which eventually organised itself around
the Committee to Defend Legitimate Rights (CDLR), and Bin Laden’s jihad
armed movement.35
While attempting to contain the pressure of the liberals, the king took
several measures to end the escalating armed insurgency by radical Islamist
elements, and to bring into line the religious protesters, who had hitherto been
one of the most important pillars of the regime and a loyal strata of society.
Announcements of a number of reforms accompanied the heavy hand of the
state in suppressing the protests.36 Thus, a royal decree in March 1992
announced the foundation of a ‘Basic System of Government’ and the creation
of the Kingdom’s first modern national consultative body, the advisory Majlis
al-Shura, which was inaugurated in August 1993. At the same time, two other
measures were adopted: first, new administrative laws for the running of
regional governments, which included the introduction of regional government and Shura councils; and, second, procedures and customs pertaining
to the succession to the throne were codified into a set of regulations.
These measures have been followed up by other changes. A new press and
The politics of participation 75
publication law was introduced in spring 2001, which guarantees freedom of
expression (‘within the framework of existing rules’), the printing of foreign
newspapers in the Kingdom, publication of newspapers by individuals or
private interests, and ‘constructive criticism’, albeit within the state’s narrowly
and carefully defined boundaries. The new press law by itself may not have
impressed many outside observers, but in the Saudi context, it again sends a
message to society that the state is becoming more tolerant of alternative views
and welcomes wider discussion of issues affecting the Kingdom.
These developments should be seen as part and parcel of the elite’s
accountability and transparency drive. The introduction of the press law,
therefore, should been seen in the context of wider developments, for it
was preceded by a cabinet reshuffle (in 1999), which usually signals the
leadership’s thinking on national issues. In a sign of the government’s efforts
to professionalise the civil service, for instance, the Bureau of Civil Service
was upgraded to that of a ministry. But as part of this general cabinet reshuffle,
the most recent event of its kind since the groundbreaking reshuffle of August
1995 (which itself was the first of its kind since the early 1970s), a number
of new ministers joined the cabinet, several of whom had already served as
members of the Shura. This point should be underlined, for such circulation
of personalities provides graphic evidence of the deepening links between the
all-powerful Council of Ministers and the increasingly influential Shura
council.
More overtly committed to the principles of Sharia’a law than many of its
neighbours, the Islamic-based Shura council is the cornerstone of the 1990s
reforms in the Kingdom and its membership and functions have slowly
changed in the period since 1993. First, the Shura’s membership was
increased from sixty to ninety, up by a third between 1993 and 1997.37 It now
includes a broader cross-section of Saudi society and is better able to articulate
its many interests and voices. Indeed, since 1995 (when its Committee of
Petitions was established) the Shura has been able to receive petitions,
complaints, and even suggestions from the general public on how to improve
the country and on how the Shura itself might be able to expand its facilities.
Although its members are entirely selected by the monarch from a carefully
scrutinised national list of potential candidates from the professions and the
business community, the Shura increasingly takes its core role of advising,
scrutinising and criticising extremely seriously. Its debates are vigorous and
thorough and its members pull no punches in their (increasingly accessible)
debates with the executive branch or in their own internal deliberations. The
speaker of the Shura carries considerable authority both within the chamber
as well as in the wider community.
Institutionally and procedurally, the Shura has evolved quickly, increasingly resembling a complex organisation which is acquiring a life of its own,
76 Anoushiravan Ehteshami
and being propelled by its own momentum into realms of political activities
hitherto reserved for the royal court. As al-Saud explains, ‘in practice,
members of the [Shura] are allowed to initiate legislation and review domestic
and foreign policies of the government’.38 It routinely also issues resolutions
and makes recommendations which have an obvious bearing on the work of
the government.39 My own first-hand experience of the Shura suggests that
this is a stable, reform-oriented technocratic forum which, in a traditional
and inherently conservative society such as Saudi Arabia, will serve as the
ideal sounding board for the testing of future reform plans, and possibly acting
as the ideal vessel for their introduction as well. Its membership comprises a
highly educated, confident and influential group of men, whose importance
is reflected in their membership of the Shura – and not the other way round.
Furthermore, if architectural politics was to be seen as a factor, then the
building of the Shura, with its generous proportions, support structures, and
lavish interior, signals two things to the curious visitor: first, that the Shura
council is a welcome and permanent feature of political life in the Kingdom;
and second, that the Shura is an important national institution worthy of
nurturing and developing. As its functions evolve and its four-yearly rotating
membership slowly expands (there is talk of its membership rising to 120),
one is left with the thought that, in the last analysis, Saudi Arabia is unlikely
to be far behind its neighbours in experimenting with pluralisation. But things
will be different here, as the self-avowed liberal Prince Talal has noted:
the majority in Saudi Arabia . . . prefer gradual steps towards a
democratic life. If the citizen can express an opinion and take part in
decisions in one way or another, that is what is important . . . the structure
of the Saudi system is different than [other countries] there are customs
[here] and customs are stronger than laws.40
United Arab Emirates
Finally, in the United Arab Emirates, a forty-member National Federal
Council was soon established after the creation of the UAE in 1971. The
council has played an active part in the evolution of the UAE as an integrated
state, but it has never acted as a vehicle for the expansion of the political base
of the country. Throughout, it has remained a technical organisation, which
re-started its meetings in 1993, after a two-year break following the Kuwait
crisis. Its membership today is more technocratic and youthful than in the
past, but its numbers have not expanded, nor has its agenda changed in any
meaningful way. Despite perceptible changes at the federal level, a major
cabinet reshuffle in 1997 for instance, little other political activity at that level
is apparent. The big question for the UAE today is how smoothly will the
The politics of participation 77
succession from Sheikh Zayed to his son (Sheikh Khalifa) be handled, and
how effective a ruler will the latter prove to be. Such big issues seem to
overshadow all others relating to political reform. Uniquely amongst the GCC
states, political activity in the UAE tends to take shape at the more local
(emirate) level than at the national level, but the members of the federation
are so closely tied to each other that little room for each to experiment with
new political structures exists. For that reason, evidence of major changes is
hard to come by.
Having considered the nature, content, type and dynamics of political
activity in the GCC states today, one must not lose sight of the diversity of
developments in this part of the world. Richard Lawless’s observation comes
to mind: Gulf Arab societies may appear similar but they should not be treated
as though they were a homogeneous entity. On closer acquaintance, he notes,
one is struck by their diversity.41
Implications of the political reform process
Looking back at the debates of the 1970s, it is quite astonishing how far these
countries have travelled, and how far we have come in our understanding the
complex and subtle structures and relationships which make up societies of
the Arabian Peninsula. The suggestion made by Halliday in 1979 that ‘the
record of the past four years [i.e. since the publication of his Arabia Without
Sultans]’ had been, ‘on balance, deficient’ does not hold true just two decades
later. ‘In the two Gulf countries that had some minimal, circumscribed forms
of representative assembly, Kuwait and Bahrain’, he said, ‘even these timid
entities proved too much of a threat to the ruling families and they were
dissolved’.42 Yet today, Kuwait and Bahrain, along with Qatar, are the
vanguards of a new wave of reforms. It is also astonishing to see how far
these states have come in terms of managing change, and the vast oil income
which brought with it an array of economic, social reforms (as well as, latterly,
political reforms) into their traditional societies. With new reforms under
way and signs of renewed political dynamism in evidence across the
Peninsula, it is perhaps appropriate to consider some of the medium- to longterm implications of the reform process on the GCC group of states – the
home of family-based rule in the Arab world.
One strong conclusion emerging from the survey of the types of institutional political activities is that, far from the GCC being a stagnant political
arena, there is actually a great deal of dynamism which now characterises
these states. What we can glean from the range of political activities in the
oil monarchies is that most GCC leaders are now convinced of the virtues of
widening participation. They are doing so at different rates and with different
intensity, however. Some have opted for the radical overhaul model,
78 Anoushiravan Ehteshami
introducing major reforms and clearing the way for the establishment of
constitutional democratic monarchies, while others have been more cautious
and have preferred a more gradualist approach, focusing instead on the
opening up of political space within the bounds of the existing political
system. Even within these two models one finds quite a range of options being
explored by the Gulf rulers. In the case of the cautious states, for instance, one
finds that Oman is evidently more keen to widen participation across the
genders than experimenting with the introduction of new institutions. The
sultan does not see the creation of new institutions as enhancing popular
participation in setting priorities and determining policies. In Saudi Arabia
by contrast, the elite seems more committed to widening access through the
expansion of the Shura system, while also creating the legal framework within
which national debate can take shape. The introduction of the new press law,
for instance, could be seen as providing some opportunities for widening
participation in debating issues of national or local importance. In the
medium-term, the establishment of independent press houses could represent
the growth of independent institutions with a separate voice (and identity)
from that of the state. If such a change was to occur it would mark a definite
departure from the assumed practices of a rentier state, in which the state is
said to be in control of all public spaces. The role that the independent press
in Iran played in advancing the reform process at its early stages could also
be instructive here.
Uniquely in the Muslim world, the GCC states have managed to keep some
of their traditional political features while also adapting to the forces of
modernisation. In virtually every oil monarchy today, one can be invited to
go to a ‘diwan’ to participate in a hot debate, or walk into a majlis (open
meeting) held by a senior member of the royal family, a government minister,
or both. In Saudi Arabia, one can appear, unannounced, and personally
petition the king and the crown prince twice a week, petition governors on
an almost daily basis, and attend majlises of dozens of influential Saudi
personalities on a daily basis.43 Prince Salman has explained the importance
of the open majlis system to the Kingdom in the following way:
Saudi people have become accustomed to the practice of the Majlis. The
main aim here is to establish some sense of close relationship between
leaders and the general public. Attending the Majlis has become a deeprooted custom and a tradition which some people would not like to miss.44
Looking at it from the leadership’s perspective, the majlis system provides
a direct and tangible link between the rulers and the ordinary citizen. This kind
of instant access may not have the trappings of an institutionalised political
structure, but by virtue of opening the door to every citizen with a problem
The politics of participation 79
or an opinion, it does allow a bond to grow between the rulers and the ruled.
Again with comparison to Iran, it could be argued that this perhaps was the
main missing ingredient in the Iranian elite’s relations with the wider society
which eventually caused the demise of the Pahlavi monarchy in Iran.
Returning to the ‘big picture’, how might the bounty of reforms already
enumerated affect political participation in the GCC as well as the relationship
between the ruling elites and an emerging civil society? Considering that as
recently as 1992 Kuwait was seen to be providing the oil monarchies’ only
pluralist model, I would argue that we have indeed come a long way from the
days in which these countries were famous for their political stagnation. The
surprise today is not so much how the GCC states have changed – though,
as we have seen, this is an interesting question in its own right – but how did
the other GCC states manage to ‘stand still’ for so long and preserve their
traditional modes of political interaction without exhibiting the outward signs
of implosion. The answer of course is that resistance was definitely growing
in more than one of the oil monarchies, which could have caused implosion,
but that in the end the regimes were able to contain these. Take Bahrain, for
example, which was plunged into a mini-civil war in the 1990s as discontent
with the style of the Khalifas’ rule spilled onto the streets of Manama and
other towns. The growing economic and political price of the rebellion was
such that it prompted the ruler to change direction and opt for a pluralistic
mode of governance. Bahrain also badly needed to create the stability that
international financiers find attractive if it was to successfully establish itself
as the new financial hub of the region.
In Saudi Arabia too, the contours of an emerging armed rebellion, coupled
with the damaging activities of such organisations as the CDLR, encouraged
the leadership to be more proactive in introducing some reforms and in
considering issues such as widening access. Although Saudi Arabia is far
from an implosion, its leaders have nonetheless preferred to engage with the
issues rather than allow them to become open political wounds. One simple
explanation of this new approach in the Kingdom is to be found in its efforts
to minimise the damaging impact of such vocal opponents as Osama bin
Laden. Defensive political responses aside, we must look for reasons in the
economic realm as well.
As has already been highlighted, one of the main push factors for
broadening the reform process in the oil monarchies has been the so-called
‘fiscal crisis of the state’. One argument is that as the allocative mechanisms
of the GCC rentier states diminish, so they introduce economic reforms,
which also increasingly seem to have a political dimension. The question
then is, can rentier, and in the case of Saudi Arabia, rentier-corporatist
structures be reformed sufficiently to allow for the development of the
economy as well as the opening up of the political system. With the current
80 Anoushiravan Ehteshami
intensity of reform-oriented activities in the GCC, one can dare to be
optimistic and give a cautious yes as an answer, providing that widening
participation measures go hand-in-hand with improvements in governance.
Gause and others have noted that the decline in oil prices since the mid-1980s
has forced the GCC governments to face some unpalatable economic choices
(privatisation, cuts in subsidies, introduction of taxes, abolition of free
facilities, bureaucratic restructuring, etc.), which have had very significant
political consequences for the governing elite and its relationship with a statedependent society.45 Such crises may have forced the pace of reform, but
perhaps not its content. The latter has increasingly been set by the need to
reform the socio-economic relations of society. Something which not only has
been recognised by the elites, but actually has evolved from within the rentier
structures of the oil monarchies themselves. As Gause notes:
As the role of the state in these countries has grown, it has begun to call
forth new demands for representative institutions and responsible
government from society. Those demands spring from the very processes
of state growth and expansion occasioned by the oil boom. The recent
upsurge [i.e in the 1990s] in political activity in the Gulf monarchies is
not only consistent with the realities of the rentier state and its
relationship to society, but is in fact generated by those realities.46
In 1993, Norton was arguing that ‘the time-honored remedies [of] co-opting
critics, bribing recalcitrants with privileged access to power and deals, locking
up dissenters’ will no longer work in the Middle East region, because ‘few
rulers today have the pockets deep enough or jails large enough to cope with
the problem in traditional ways’.47 It has also been intimated that an inclusive
policy, which ‘would necessitate the introduction and implementation of
reforms that open up outlets for the free expression of opinion, limit the
arbitrary exercise of power and permit political association’, may be the only
way forward, but perhaps such solutions might be too high a price to pay for
some GCC rulers.48 GCC leaders could examine such reforms in the cold
light of day and conclude that they are too destabilising politically and
therefore beyond the means of their (rentier) societies. Yet, far from the
reform process – which could hardly be regarded as slow when looked at in
its entirety – being seen as destabilising by the leaderships, the rulers
themselves are emerging as the very agents of political change, with the
trend very much towards a broadening of the reforms. The era of containment
seems to be firmly behind us; as a Bahraini colleague put it, the march of
constitutionalism has already started. But as the process of reform is being
guided ‘from above’, questions should be asked about the nature of the
process and whether the reforms are of enough significance if they do not
The politics of participation 81
encompass reform of socio-cultural and political structures of the oil
monarchies as well – the very pillars on which the elites lean for power and
legitimacy.
Furthermore, there is still no way of telling how the 11 September 2001
attacks on the US will play out in the region. It has been suggested that the
crisis will encourage the GCC rulers to clamp down on (particularly Islamist)
dissent and use this opportunity to backtrack on the promised political
reforms. If the crisis was to degenerate into a conflict between Islam and the
West, with Saudi Arabia being forced to play a pivotal Islamic role, public
opinion across the region may push the more liberal elements in the ruling
families on the defensive, pressing them to denounce Western-style reforms.
It remains to be seen whether this will in fact be the case. But an alternative
scenario could also be developed, through which the GCC leaders use this
crisis as an opportunity to widen their domestic power base, limit the political
influence of the tribes and the Islamists, and push through reforms on both
the economic and political fronts.
Many problems remain then. Critics of the oil monarchies point to the
broader governance issues to make the argument that for all the reform
measures adopted or proposed, power continues to rest in the hands of a
family group embedded in the structures of the state. In the absence of
decision-making bodies outside of the rulers’ circle, political parties, an
accountable and responsive government and ruling elite, transparency in the
workings of the government and its agencies, more powerful Shura councils,
an effective legal framework for rights, a free press, and suitable conditions
for the free flow of ideas, these societies remain far from a democratic or
pluralistic path. While many of these concerns are valid, one can still maintain
that as elections grow in importance as the most effective transmitter of
priorities between state and society, their mediatory role will increase,
bringing with them new structures and real changes in state–society relations
– even in the rentier states of the Arabian Peninsula. Such processes also
allow for the spread of the risk by the GCC leaders in an increasingly
globalised world where external crisis can very easily acquire a domestic
footing. As Nonneman notes, ‘opening up the decision-making process for
non-royal actors, and expanding avenues for popular participation, can . . .
spread responsibility for difficult decisions or circumstances, or for
government failures’.49 Reform as a process is now firmly on the agenda of
these countries, albeit at a measured pace. Let us recall the phrase that ‘Rome
was not built in a day’, and note in the context of the GCC states that reform
from above is still far more preferable to revolution from below.
82 Anoushiravan Ehteshami
Notes
* This chapter is based on ‘Reports from Above: The Politics of Participation in the
Oil Monarchies’, International Affairs 78 (4) (January 2003).
1 Robert W. Stookey (ed.) The Arabian Peninsula: Zone of Ferment (Stanford,
CA: Hoover Institution Press, 1984), pp. xxx–xxxi.
2 Jamal Al-Suwaidi, ‘Arab and Western Conceptions of Democracy: Evidence
from a UAE Opinion Survey’, in David Garnham and Mark Tessler (eds)
Democracy, War and Peace in the Middle East (Bloomington, IN: Indiana
University Press, 1995), pp. 82–115; Fred Halliday, ‘The Gulf War and Its
Aftermath: First Reflections’, International Affairs 67 (April 1991), pp. 223–334.
3 For a concise discussion of the relevant issues see Graham Fuller, ‘Respecting
Regional Realities’, Foreign Policy 83 (Summer 1991), pp. 39–46.
4 Roger Hardy, Arabia after the Storm: Internal Stability of the Gulf Arab States
(London: RIIA, 1992) p. 14.
5 J.E. Peterson, ‘The Nature of Succession in the Gulf’, Middle East Journal 55
(4) (Autumn 2001), pp. 580–601.
6 For reflections on the GCC legal framework, for instance, see Nathan J. Brown,
The Rule of Law in the Arab World: Courts in Egypt and the Gulf (Cambridge:
Cambridge University Press, 1997).
7 For an extremely helpful short guide to the democratisation debate in the
developing world, see Robert L. Rotherstein, ‘Democracy in the Third World:
Definitional Dilemmas’, in David Garnham and Mark Tessler (eds) Democracy,
War and Peace in the Middle East (Bloomington, IN: Indiana University Press,
1995), pp. 65–81.
8 For a typical argument, see Fouad Al-Farsy, Modernity and Tradition: The
Saudi Equation (London: Kegan Paul International, 1990).
9 For an interesting discussion of such factors, see William Quandt, Saudi Arabia
in the 1980s (Washington, DC: Brookings Institution, 1981).
10 Quoted in Robin Allen and James Drummond, ‘Emir’s Claims for Democracy
Have Yet to be Tested’, Financial Times Survey: Qatar (7 November 2001),
p. ii.
11 This is the title of Fred Halliday’s famous book, Arabia Without Sultans
(London: Pelican, 1979), first published in 1974.
12 Ibid., p. 49.
13 Giacomo Luciani, ‘Resources, Revenues, and Authoritarianism in the Arab
World: Beyond the Rentier State?’, in Rex Brynen, et al., Political Liberalization and Democratization in the Arab World: Theoretical Perspectives
(Boulder, CO: Lynne Rienner, 1995), p. 211.
14 Kiren Aziz Chaudhry, The Price of Wealth: Economies and Institutions in the
Middle East (Ithaca, NY: Cornell University Press, 1997), p. 141.
15 Monte Palmer, Ibrahim Fahad Alghofaily and Saud Mohammed Alnimier, ‘The
Behavioral Correlates of Rentier Economies: A Case Study of Saudi Arabia’, in
Robert W. Stookey (ed.) The Arabian Peninsula: Zone of Ferment (Stanford,
CA: Hoover Institution Press, 1984), p. 20.
16 Hazem Beblawi, ‘The Rentier State in the Arab World’, in Hazem Beblawi and
Giacomo Luciani (eds) The Rentier State (London: Croom Helm, 1987), p. 53.
17 Giacomo Luciani, ‘The Oil Rent, the Fiscal Crisis of the State and Democratization’, in Ghassan Salame (ed.) Democracy without Democrats: The
Renewal of Politics in the Muslim World (London: I.B. Tauris, 1994), p. 152.
The politics of participation 83
18 Nazih N. Ayubi, Over-stating the Arab State: Politics and Society in the Middle
East (London: I.B. Tauris, 1995).
19 John Bulloch, Reforms of the Saudi Arabian Constitution (London: Gulf Centre
for Strategic Studies, 1992).
20 Ghanim Alnajjar, ‘The Challenges Facing Kuwaiti Democracy’, Middle East
Journal 54 (2) (Spring 2000), pp. 242–58.
21 The emir’s decree would have enabled women to run for office, vote and be
elected as of the parliamentary and municipal elections scheduled for 2003. The
decree has had a very mixed reception amongst the Islamist groups in Kuwait,
most of whom opposed the measure. The Economist (22–28 May 1999).
22 Emir Khalifa expanded the membership of the advisory council from 20 to 30
members in 1975 and to 35 in 1988. He also extended its term from two to four
years. For a review of earlier Qatari and Bahraini attempts to introduce
constitutional government, see Emile A. Nakhleh, ‘Political Participation and
the Constitutional Experiments in the Arab Gulf: Bahrain and Qatar’, in Tim
Niblock (ed.) Social and Economic Development in the Arab Gulf (London:
Croom Helm, 1980), pp. 161–76.
23 ‘“Democracy” in Doha’, Gulf States Newsletter 24 (607) (22 March 1999), p. 3.
24 See my ‘Is the Middle East Democratizing?’, British Journal of Middle Eastern
Studies 26 (2) (November 1999), pp. 199–217.
25 Abdullah Juma Al-Haj, ‘The Politics of Participation in the Gulf Cooperation
Council States: The Omani Consultative Council’, Middle East Journal 50 (4)
(Autumn 1996), pp. 559–71; Sultanate of Oman Majlis A’Shura Structure and
Main Organs (1997–2000 A.D.), (Ruwi, Oman: Golden P. Press, 1999).
26 Information supplied by Ahmed al-Mukhaini, Durham, November 2001.
27 The Majlis al-Dawla already has five female members, and there are four
women deputy ministers as well. In the 2000 Shura elections 30 per cent of
175,000-strong electorate was assigned to female voters. Oman’s ambassador to
the Netherlands is also female.
28 ‘Oman: Elections Carry Forward a Quiet Experiment in Gulf Democracy’, Gulf
States Newsletter 24 (645) (25 September 2000), p. 7.
29 Quoted in Latheef Farook, ‘Bahrain Declared Constitutional Monarchy’, Gulf
News (15 February 2002). To reiterate the depth of the reforms, the emir also
annouced the dates for the new elections in the new Kingdom, bringing these
forward to 9 May 2002 for municipal elections and 24 October 2002 (which had
been scheduled for 2004) for parliamentary elections.
30 One elected lower chamber to tackle all legislative matters, and an appointed
Shura council to fulfil a consultative role.
31 Brought forward to 2002 by the emir.
32 According to the election monitoring committee, 217,579 individuals were
extended the vote, of whom 196,262 chose to participate in the ballot. 191,790
people supported the charter. Arabicnews. com (17 February 2001).
33 Rahshe Aba Namay, ‘Constitutional Reform: A Systemization of Saudi
Politics’, Journal of South Asian and Middle Eastern Studies 16 (3) (1993),
pp. 43–88.
34 F. Gregory Gause III, ‘The Gulf Conundrum: Economic Change, Population
Growth, and Political Stability in the GCC States’, The Washington Quarterly
20 (1) (Winter 1997).
35 Mamoun Fandy, Saudi Arabia and Political Dissent (London: Macmillan Press,
1999).
84 Anoushiravan Ehteshami
36 The proposals focused on the so-called ‘three reforms’: Nidham al-Asasi,
Nidham al-Shura and Nidham al-Manatiq.
37 The ninety-member Shura was inaugurated in July 1997. For an analysis of the
social background of the Shura members and their role, see R. Hrair Dekmejian,
‘Saudi Arabia’s Consultative Council’, Middle East Journal 52 (2) (Spring
1998), pp. 204–18.
38 Faisal bin Misha’al Al-Saud, ‘Political Development in the Kingdom of Saudi
Arabia: An Assessment of the Majlis Ash-Shura’ (PhD Thesis, University of
Durham, 2000), p. 175.
39 Mohamed bin Abdullah al-Mihna, Sejel Amel Majlis Ash-shura wa Injazetah
Khalal Dourateh Awali, 1414–1418 (Review of the Activities of the Majlis alShura During its First Term, 1993–1997) (Riyadh: Majlis al-Shura Printing
Office, 2000).
40 Prince Talal bin Abdul Aziz. Reuters (4 March 1998).
41 R.I. Lawless (ed.) The Gulf in the Early 20th Century: Foreign Institutions and
Local Responses (Durham: Centre for Middle Eastern and Islamic Studies,
1986), p. 1.
42 Arabia Without Sultans (London: Pelican, 1979), pp. 521–2.
43 I had the pleasure of attending the mid-day majlis of Prince Salman (Governor
of Riyadh) in Riyadh in February 2001. This was a truly extraordinary
experience, where one witnesses one of the most senior members of the al-Saud
household personally receiving petitions from literally hundreds of young and
old people, Saudi nationals and foreigners, who flock to his majlis. He receives
every single person, sits and personally reads every petition handed to him,
issues instructions, explores the more complex issues with the plaintiff, arranges
for the petitions of women visitors (who wait elsewhere while their problem is
being attended to) to be dealt with, and, well over an hour later, leaves to attend
to the affairs of the state. On average, he does this twice a day!
44 Quoted in Faisal bin Misha’al Al-Saud, ‘Political Development in the Kingdom
of Saudi Arabia: An Assessment of the Majlis Ash-Shura’ (PhD Thesis,
University of Durham, 2000), p. 146.
45 F. Gregory Gause III, op. cit.
46 F. Gregory Gause III, Oil Monarchies: Domestic and Security Challenges in the
Arab Gulf States (New York: Council on Foreign Relations Press, 1994), p. 81.
47 Richard Augustus Norton, ‘The Future of Civil Society in the Middle East’,
Middle East Journal 47 (2) (Spring 1993), p. 206.
48 Michaela Alexandra Prokop, ‘Political Economy of Fiscal Crisis in a Rentier
State: Case Study of Saudi Arabia’ (PhD Thesis, University of Durham, 1999),
p. 208.
49 Gerd Nonneman, Governance, Human Rights, and the Case for Political
Adaptation in the Gulf: Issues in the EU–GCC Political Dialogue (Badia
Fiesolana: European University Institute Policy Paper 3, 2001), p. 5.
4
Good international
governance
Implications for Saudi
Arabia’s political economy
Rodney Wilson
The aim of this chapter is to examine the conduct of economic policy-making
in Saudi Arabia. To what extent does it conform to the ideals of international
economic institutions such as the IMF, of which Saudi Arabia is a member,
or the WTO, which the Kingdom has yet to join? Although there is official
caution about any change which might undermine the political status quo in
Saudi Arabia, the Kingdom is divided over what economic policy should be
adopted, with some officials and younger princes favouring a more open
economy, while others favour a continuance of protectionism.
Economic openness implies greater transparency in decision-making and
accountability to international organisations, which challenges traditional
procedures of governance and has implications for government policy in
states such as Saudi Arabia. It does not necessarily threaten the system of
government, however, but rather it is a matter of conforming to international
reporting requirements and of pursuing economic policies that may be
opposed by those with a vested interest in state protection.
In order to put these policy choices into context it is useful to examine
the workings of the economy and challenges faced, notably the issue of
unemployment. It is also relevant to examine fiscal policy, both with regard
to the extent to which it addresses the problems facing the economy, and
whether it is consistent with the policies advocated by the IMF.1 As the opening
up of the economy to foreign investment has been an important agenda item
in the negotiations to join the WTO, together with trade liberalisation, the
Kingdom’s investment and trade policies will also be considered. Finally the
difficulty in acceding to WTO membership requirements will be considered,
as this presents more of a challenge to the Kingdom than IMF obligations.2
An oil-dependent economy
As the economy of Saudi Arabia remains highly dependent on oil, the level
of economic activity is largely determined by oil price and production
86 Rodney Wilson
developments. Government policy has aimed to encourage economic
diversification, but the comparative advantage of the economy is in oil related
activities, a situation which is unlikely to change for the foreseeable future.
As the Kingdom accounts for at least one third of proven world oil reserves,3
it makes sense to exploit this resource, especially given the relatively low
extraction costs compared to those in most other regions of the world.
Although OPEC has been less effective in controlling oil prices during the
last two decades than it was in the 1970s, joint action to curtail production
can still have a marked effect. When Saudi Arabia, Iran and Venezuela agreed
to curtail production in April 1998, for example, prices eventually rose from
below $10 to almost $18 a barrel by August 1999 for their crude oil.4
The link between oil pricing and production developments and gross
domestic product changes is long term rather than short term in nature, as
there are a number of lags in the revenue transmission process, and the
government can draw on reserves or borrow to overcome temporary revenue
shortfalls. Nevertheless, Table 4.1 shows that during the 1993–5 period when
oil prices fell, GDP also declined in Saudi Arabia, and although 1996 and
1997 were better years, there was a further decline in 1998. The upturn in oil
prices in 1999 has been slower to become transmitted to an improvement in
GDP, as the government seeks to reduce its deficit rather than undertake
further ambitious public spending commitments. This is in line with IMF
policy recommendations. However, as Saudi Arabia is not indebted to the
IMF, the deficit reductions are more a matter of maintaining credibility in
international financial markets than of complying with the norms of a
particular international organisation.
Table 4.1 Gross domestic product indicators for Saudi Arabia
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Nominal GDP,
$ million
Real GDP
change, %
Per capita
GDP
104,670
118,035
123,204
118,515
120,168
125,688
136,537
146,171
131,670
133,595
140,924
10.7
8.4
2.8
–0.6
0.5
0.5
1.4
1.9
1.6
0.0
1.4
7,039
7,136
7,264
6,831
6,766
6,887
7,247
7,500
6,530
6,420
6,560
Source: Economist Intelligence Unit, London.
Saudi Arabia’s political economy 87
Table 4.1 also shows real annual GDP changes with growth performance
extremely variable during the 1990s, again largely reflecting oil pricing and
production developments, but overall growth has been moderate over the
decade averaging 2.6 per cent. Per capita GDP data gives some indication of
living standards and their potential purchasing power with respect to imports.
Living standards are relatively high in Saudi Arabia in relation to many
developing countries and Arab states, but lower than in the smaller GCC
states. The level of per capita GDP is important in determining what status a
country should have in the WTO, with developing countries with lower per
capita GDP given more lengthy transitional periods for reducing tariffs and
phasing out trade barriers. Saudi Arabia has argued that it wants developing
country status, rather than have to introduce the more rapid trade liberalisation
agreed by the smaller GCC states when they were admitted to the WTO.
Economic growth will depend on how effectively the improved oil revenue
flows are managed, over which there is greater uncertainty. The oil revenue
windfall of 1999 may reduce pressures for reform and privatisation, as the
state can again contemplate capital spending. Nevertheless there are some
encouraging signs that bode well for the future. The share of the private sector
in GDP is increasing rapidly, from only 33 per cent in 1997 to 40 per cent by
1999.5 The measures taken to raise non-oil revenues in May 1999 are being
implemented in full, with raised electricity tariffs, higher local petroleum
prices for domestic consumers, increased work permit fees and departure
taxes on foreigners expected to raise at least $3 billion annually.6 Overall
the most lasting effect of the 1997–8 oil price falls is likely to be the more
diversified sources of revenue, and increased caution in increasing government spending in response to oil revenue increases alone.
Demographics and employment
With a population in excess of 20 million, Saudi Arabia has experienced one
of the highest rates of population growth in the world. This is accounted for
by the very high rate of natural increase and a continuing dependence on
imported manpower. The population was below 9 million at the time of the
1973–4 oil price increases. Although some development specialists take a
negative view of rapid population increase, in Saudi Arabia it is demographic
pressures that have brought much of the economic growth rather than capital
accumulation.
It is the increasing population size that has stimulated market growth, as
growing numbers to feed means greater imports and sales of agricultural
commodities, while the demand for basic services such as electricity has
also reflected demographic factors as much, if not more than, rising living
standards. There is little sign of any fall in the population growth rate, which
88 Rodney Wilson
at 3.4 per cent is amongst the highest in the world despite a fall in the infant
mortality rate to 21 per thousand live births.7 Each woman has an average of
five children, although as elsewhere in the developing world, family size
tends to be larger for lower socio-economic groups than for the middle
classes. Birth rates seem to be as high in urban areas as in rural locations, and
as over 70 per cent of the population already lives in urban areas, there is less
scope for a slowdown in population growth resulting from rural–urban
migration in any case.
The labour force in Saudi Arabia has grown rapidly during the 1990s to
over 9 million (see Table 4.2). This was insufficient, however, to provide
work for the increasing numbers seeking employment, causing increasing
frustrations in the younger generation. As the government lacks the resources
to create employment in the way that they did in the 1970s and early 1980s
alternative solutions will have to be found. Some estimate that the male
unemployment rate exceeds 25 per cent, despite skill shortages in many areas
such as information technology, aeronautics, finance and banking.8
In Saudi Arabia around 4 million of the 9 million workforce are foreign
nationals, although there has been little increase in their numbers in recent
years. There are strong pressures for local nationals to be given the jobs that
are available, which means increasing pressures to restrict work permits,
although employers in the region are generally against such restrictions.
In the long term, training for local nationals can help, and much is being done
already, although the education system, which has been strongly influenced
by Egyptian teachers and administrators, does not impart the skills and
knowledge required in an increasingly sophisticated economy.
There are already very strict laws governing naturalisation, restrictions on
work permits and policies that encourage the employment of local citizens,
Table 4.2 The labour force in Saudi Arabia
Million
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
5.64
6.12
6.19
6.68
6.87
7.14
7.40
7.80
8.26
8.54
9.02
Source: Economist Intelligence Unit, London.
Saudi Arabia’s political economy 89
but despite this, a high proportion of the active workforce continues to
be made up of foreign nationals. During the last decade there has been
more reliance on workers from South Asia and the Philippines, and relatively
less on workers from other Arab countries, although Yemenis continue to
undertake much menial work in Saudi Arabia, not all of which is recorded.
Local nationals have increasing paper qualifications, but often still remain
reluctant to take jobs on offer or accept the pay rates of migrant workers.
Government finances and fiscal policy
The finance minister of Saudi Arabia sits on the board of executive directors
of the IMF, and there can be little doubt that fiscal policy in the Kingdom has
been much influenced by the Washington conventional wisdom. This stresses
the importance of sound finances, with revenue covering expenditure over the
business cycle. Such policies, it is believed, create a stable economic environment for growth, including long-term growth in employment, although it is
debatable how far the policies are appropriate for Saudi Arabia’s short-term
employment creation needs.
Oil revenue is the major source of government finance, accounting for
around two-thirds of total revenue in Saudi Arabia.9 The share varies from
year to year, reflecting oil price and production developments, but these also
affect the overall level of revenues, given the political problems posed by
raising revenues from other sources.10 Non-oil tax revenues are dependent on
the overall state of economic activity, which is itself affected by oil sector
developments, so even if the tax base was more diversified, this would not
entirely solve the problem of oil reliance. The major non-oil revenue sources
are indirect taxes, notably import duties and charges for services provided by
the state. It is the latter which were increased to raise non-oil revenue during
the last period of low oil prices in 1998, with Saudi Arabia introducing airport
taxes, raising visa charges and increasing retail fuel prices.11
Saudi Arabia has no income tax, but Zakat, an Islamic religious tax,
is widely paid, with liability calculated by self-assessment of the value of
financial assets. A sum equivalent to one fortieth of the value of financial
assets is payable annually by Muslims through a form of alms giving, with
receipts being earmarked for use in charitable causes, such as health care or
educational scholarships for children from poor families.
There is no real crowding out of private savings by the substantial government revenue, as would be the case if the revenue came through personal
taxation. And because corporate taxes are minimal outside the oil sector, there
is little negative impact from government financing for private investment in
business. As elsewhere in the world, government expenditure in Saudi Arabia
is largely dependent on the buoyancy of revenue sources in the long term,
90 Rodney Wilson
although in the short term the government can borrow in anticipation of future
revenue. The authorities have sought to keep expenditure under strict control
for most of the 1990s because of the uncertainties over oil revenues. Capital
expenditures have been cut, and the numbers of public sector employees
virtually frozen, together with their wages. Transport and infrastructure
spending has borne the brunt of the cutbacks, while it has been difficult to
reign in spending on defence, education and health. In Saudi Arabia spending
on transport and infrastructure in the 1990s averaged between one third and
one half of its level in the previous decade, but by 1998 education expenditure
was at an all time high, reflecting the increase in the school age population.
This was also the case with health expenditure as the absolute numbers
of older people increased to record levels. By 1998 defence expenditure
accounted for 40 per cent of total government expenditure in Saudi Arabia,
education around 24 per cent of the total, and health about 9 per cent.12
Saudi Arabia has a budget deficit but although this is substantial, the
situation remains under control. Indeed deficits have been generally lower
during the second half of the 1990s than earlier in the decade (see Table 4.3),
and Saudi Arabia coped better with the 1998 downturn in oil prices than with
previous downturns. Control over public expenditure has been effective for
the most part, without the adverse social and political consequences predicted
by some observers, and increases in utility charges have alleviated funding
difficulties.
Fiscal policy instruments are fairly crude in the Kingdom, the major means
of reacting to deficits being simply to slow down or postpone capital spending,
including disbursements for existing projects. Diversifying revenue sources
is realistically seen as a long-term task, rather than within the remit of demand
management. Indeed, the key issue is ultimately structural reform, not shortTable 4.3 The budget as a percentage of GDP
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Revenue
Expenditure
Balance
30.1
46.3
36.8
31.8
28.7
31.1
34.6
37.5
29.0
30.3
31.6
36.5
55.1
45.7
42.4
38.0
36.9
37.9
40.4
38.3
36.3
35.5
–6.4
–8.8
–8.9
–10.6
–9.3
–5.8
–3.3
–2.9
–9.3
–6.0
–4.0
Source: Economist Intelligence Unit, London.
Saudi Arabia’s political economy 91
term deficit control. Budget announcements are useful as a guide to spending
plans and government priorities, but they should not be judged in the context
of short-run macroeconomic management.
The Finance Ministry in Saudi Arabia tends to be reactive rather than
proactive, cutting current and capital spending after oil price falls and
increasing it in better times. There has been no real attempt to date to anticipate the oil price cycles and steer the economy accordingly. Indeed, de facto
power over government revenues lies more in the hands of the Ministry of
Petroleum and Energy rather than the Finance Ministry, whose primary
function is the control of disbursements. Nevertheless, slow changes are
occurring, and it is notable that no attempt was made to revise Saudi Arabian
government spending targets upwards in 1999 despite the better than expected
revenue flows from the higher oil prices. The Saudi Arabian minister of
finance and national economy, Ibrahim al-Assaf, has been much tougher
than his predecessors in keeping spending ministries in check and has used
oil windfalls to pay off past government debts to farmers, contractors and
suppliers.13
As the local capital market in Saudi Arabia is very limited in size and depth,
much of the budgetary deficit has to be financed through international
borrowings. This can be cheaper than local borrowings in any case, as the
Kingdom has a favourable credit rating from Moodys and other agencies.
The ratio of foreign debts to exports, a useful measure of a country’s ability
to service its international financial obligations, has risen substantially in the
1990s as Table 4.4 shows.
Table 4.4 The ratio of foreign debt to exports in Saudi Arabia
Percentage
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
27.5
29.4
28.3
37.9
43.6
33.1
25.8
34.5
64.7
66.2
62.4
Source: Economist Intelligence Unit, London.
92 Rodney Wilson
The outlook for privatisation
Financial imperatives rather than a desire for privatisation are nevertheless
changing the role of the state. Crown Prince Abdullah chairs a new Higher
Economic Council that includes ten private sector representatives along
with government ministers. There has been much institutional reform to
establish the prerequisites for privatisation, including the corporatisation of
the electricity sector. Actual privatisation is proceeding only slowly, however,
although the Saudi Telecommunications Company, which was split off from
the postal service, seems likely to be the first candidate.14
The future direction of policy remains uncertain despite the lip service
paid to reform and the increasing influence of younger ‘technocrats’. In the
banking sector, for example, which was very fragmented in Saudi Arabia,
with too many small banks, the merger of the Saudi American Bank with the
United Saudi Bank created a much stronger private corporate entity. However
to ‘strengthen’ the leading bank in the Kingdom, the Public Investment Fund
took a 50 per cent stake in the National Commercial Bank, which could be
interpreted as a nationalisation measure.15
Similarly, the rationalisation of the electricity industry in the Kingdom has
involved the creation of a huge state-owned organisation, the Saudi Electricity
Company.16 There have been differences between the Ministry of Finance
and National Economy and the Ministry of Industry and Electricity over
the merger of the ten regional power companies into the new entity, with the
latter favouring a more decentralised system. The rationale for these changes
is to have a national tariff structure which makes generation potentially more
profitable. Hence, subsequently, if generation and transmission are separated,
multinational companies can participate in the build–own–operate (BOO)
projects, which means investment funding for generation can be raised
privately.
As the electricity sector on some estimates will require investment of $117
billion by 2020, the attraction of transferring this commitment from the
government to the private sector is clear. However, the two projects which
had been cited as possibilities for BOO financing, the 1,100 MW Shuaiba
plant in the western region and the 1,000 MW Shuqaiq power generation
project in the south, are being financed by the government itself, as the oil
revenue position has improved.17 It seems that private financing may only be
acceptable on an experimental basis for small generation projects serving
industrial users rather domestic consumers in major cities.
Investment
The economy of Saudi Arabia is linked to the global economy through capital
flows as much as by oil.18 It is the international economy that provides the
Saudi Arabia’s political economy 93
opportunities for diversified portfolio investment by local financial institutions and individuals of high net worth, as there are no restrictions on capital
movement. At the same time, it is international capital markets which can
cater for the specialist financial needs of oil related industries and utility
and infrastructure projects. As local capital markets in the region are less
developed and less efficient, given the relatively sophisticated forms of
financing required, it make sense to use international markets, even though
this reduces the Kingdom’s financial independence.
In the case of Saudi Arabia, outward investment flows are likely to remain
in excess of inward flows, partly reflecting perceived political risk factors.
It is the latter that are one of the main determinants of investor behaviour in
and towards the region, even though it is usually implicit rather than explicitly
stated, at least by local investors. Much investment policy is really aimed
at attracting local investors to repatriate or keep funds at home, rather than at
new investment from Western sources. The development of the local stock
markets has encouraged domestic investors, and the local commercial banks
now provide more investment vehicles, including mutual funds, although
many are focused on overseas markets.
Like so much else in Saudi Arabia, investment fluctuations are heavily
influenced by oil-pricing developments, with increases in oil prices resulting
in multiplier effects from government spending on both inward and outward
investment flows.19 Oil price rises directly stimulate government investment
spending as the go ahead is given for delayed infrastructure projects and
utility expansion, and price falls usually impact on capital spending before
current expenditure, which it is more difficult to cut. At the same time, in
so far as government spending boosts local business, this in turn increases
the resources available to the private sector to invest both at home and
internationally. Conversely when oil prices fall, the surpluses available for
private investment, both local and foreign, also decline.
Country risk assessments also influence investment flows, not just formal
assessments by international rating agencies such as Moodys and Standard
and Poors, but also informal assessments by local and foreign investors. The
Gulf War and its aftermath not surprisingly resulted in major capital flight
from Saudi Arabia as Table 4.5 shows, with positive numbers indicating
capital flight and negative figures capital inflows. Over $24 million left Saudi
Arabia in 1991, largely as a consequence of the war. The table illustrates how
when oil prices fell in the mid-1990s capital flight was reduced.
Joint ventures
There are opportunities for investment by foreign companies in both the oil
and non-oil sectors in Saudi Arabia. Non-oil investments include the defence
94 Rodney Wilson
Table 4.5 Capital flight from Saudi Arabia
$ million
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
–929.0
24,180.0
10,172.0
13,408.0
4,206.0
8,088.0
784.0
–6,544.8
6,129.0
5,664.3
3,358.9
Source: Economist Intelligence Unit, London.
offset arrangements, such as that involving British Aerospace in Saudi
Arabia. The broad prospects for inward investment growth are dependent on
the projected economic trends, with an emphasis on the possibility for
collaborative ventures to exploit the domestic market and possibilities in the
energy sector. There is significant scope for investment by multinational oil
companies, given the low cost base for production, the reserves, which
account for half of the world’s total, and the possibilities of increasing the
efficiency of exploration by applying the latest technology. Nevertheless,
there is a reluctance to see Western control of oil investment because of the
historical experience of production levels and prices being controlled by the
major oil companies prior to the 1970s.20 The new Saudi Supreme Petroleum
Council chaired by King Fahd has given ARAMCO the exclusive role in oil
and gas upstream.21 Despite this, Western company involvement, beyond
management contracts and specialist services, is again becoming increasingly
attractive. There is the need for the modernisation of production facilities,
the ability of the companies to offer access to consumer markets ‘in-house’,
and the risks involved in local state companies borrowing to finance their
own investments.
Given the concern over foreign control, the greatest potential is for inward
investment through joint ventures. This can be attractive to foreign companies
as it reduces investment costs, given the ability of local partners to raise
finance through bank borrowings and domestic equity placements. A creditable Western joint venture partner often enhances the financial standing of
the local company, and enables it to secure funding on more favourable
terms. International institutions such as the IMF and WTO would prefer
to see countries such as Saudi Arabia opening up completely rather than
Saudi Arabia’s political economy 95
emphasising joint ventures, but the latter are at least a second-best solution,
and ownership restrictions are viewed as a lesser evil than controls over
capital movements.
The Ministerial Oil Committee carried out a review of foreign energy
investment policy in 1999 to develop a new oil and gas strategy. Subsequently,
the Saudi Arabian authorities informed international oil companies that they
were interested in investments and joint ventures in natural gas, power, refining
and petrochemical projects.22 Of particular interest was the production and
industrialisation of natural gas.23 Upstream oil development was, however,
excluded from the list of areas open to foreign investment, as the Kingdom had
three million barrels a day of spare production capacity.
The leading international oil companies all maintain offices in Riyadh,
including BP Amoco, Exxon, Texaco, Shell, Mobil, Chevron and LG Caltex.
There is also representation from European companies such as ENI and
TotalFina as well as Far Eastern companies such as Idemitsu Kosan, Mitsubishi
and the Chinese Petroleum Corporation. In 1999 Phillips Petroleum and
Conoco opened regional offices for the Middle East in Riyadh.
Under Saudi Arabia’s foreign investment laws the establishment of wholly
foreign-owned firms is possible, but this is not a very attractive option. At least
25 per cent Saudi Arabian participation is required if the firm is to qualify
for an automatic ten-year tax holiday on profits, including tax on profits
distributed to foreign shareholders.24 Furthermore, a Saudi Arabian equity
stake of at least 51 per cent is required if a firm is to qualify as a Saudi Arabian
company, which makes it eligible for all government contracts. At least 30
per cent of all government contracts must be awarded to Saudi Arabian
companies, and in practice the figure is much higher due to discriminatory
purchasing in favour of local suppliers.
As land and property cannot be owned by foreigners or foreign companies
in Saudi Arabia, this also makes joint ventures with majority Saudi Arabian
ownership a more attractive proposition, given the greater freedom under
the Commercial Investment Law. This law is unlikely to be changed in the
foreseeable future, despite calls by foreign residents in the Kingdom for
reform, as it ensures Saudi Arabian citizens enjoy rental income from the
accommodation occupied by migrant workers.25 There is a greater prospect
of the foreign investment laws being further amended, as a result of Saudi
Arabia’s application to become a member of the World Trade Organisation.
Most foreign direct investment into Saudi Arabia originates in the United
States, which accounted for almost half of the flow in 1998 as Table 4.6
shows. There was American participation in 267 projects worth over $2.25
billion, mainly involving downstream activities using oil or defence-related
projects. Much of the investment from Bermuda and Panama also involved
American-owned companies, sometimes with Saudi Arabian participation,
96 Rodney Wilson
Table 4.6 FDI into Saudi Arabia by country, 1998
Country
No. of projects
Paid-up capital,
$ US million
United States
Japan
Bermuda
Netherlands
Jordan
France
United Kingdom
Panama
Italy
Switzerland
Lebanon
Egypt
Cayman Islands
Kuwait
Finland
Germany
Bahrain
Korea
Iran
Taiwan
Other countries
Total
267
35
18
51
114
67
146
24
54
58
149
30
30
36
15
77
11
38
11
5
373
1,609
2,252.5
576.8
312.3
219.9
214.7
198.3
147.1
107.6
100.7
97.1
90.1
84.1
79.6
77.6
74.5
58.1
57.0
49.3
39.7
39.0
97.7
4,973.6
Percentage
45.3
11.6
6.3
4.4
4.3
4.0
3.0
2.2
2.0
2.0
1.8
1.7
1.6
1.6
1.5
1.2
1.1
1.0
0.8
0.8
2.0
100.0
Source: Saudi Arabian National Centre for Economic and Financial Information, June 1999.
which is why the source is registered these tax haven locations. Investment
from Japan and the Netherlands is largely in petroleum-related activity, with
Shell associates and suppliers being significant in the case of the latter.
Of particular interest is the large number of relatively small projects, some
designed to supply the local market, while others are geared towards particular
niche export segments.
The accumulated total investment up to 1998 in joint ventures by sector is
illustrated in Table 4.7. Most of the investment, worth over $30 billion, has
been in chemicals and plastics. These petrochemical projects, largely through
SABIC, the Saudi Arabian Basic Industries Corporation, account for almost
90 per cent of the total licensed projects approved by the Ministry of Industry
and Electricity. Construction materials and machinery and equipment are
the two other categories of significance. Sectors such as food processing are
of much less importance, although given the more labour-intensive nature of
such businesses, they account for over 4,000 employees.
Joint ventures accounted for over 57 per cent of all projects approved
by the Saudi Arabian Ministry of Industry and Electricity up until 1998.
Saudi Arabia’s political economy 97
Table 4.7 Joint ventures in Saudi Arabia
Food processing
Textiles & clothing
Furniture
Paper, printing & publishing
Chemicals & plastics
Construction materials
Base metal products
Machinery & equipment
Other manufacturing
Transport & storage
Total joint ventures
Total other
% joint ventures
Number
Capital,
$ million
Employees
30
11
17
20
98
46
1
133
5
1
362
2,326
13.5
404
84
53
420
30,036
1,816
1
1,154
70
2
34,040
59,360
57.3
4,098
1,202
1,109
2,885
21,515
9,667
18
12,775
570
41
53,880
197,339
21.5
Source: Saudi Arabia Ministry of Industry and Electricity, April 1998.
This proportion may increase in coming years, as although Saudi Arabian
companies are acquiring greater technical expertise, having international
partners can ensure better access to global markets and more competitive
supplies. Furthermore, with considerable consumer awareness of branded
products in Saudi Arabia, there will be increasing scope for joint ventures in
consumer products and retailing.
WTO membership issues
WTO membership has proved a divisive issue for the GCC states. The states
have negotiated individually with the WTO rather than as a group, and
consequently the pace of negotiations and entry has varied. Bahrain, Kuwait,
Qatar and the United Arab Emirates have all become members of the
WTO, but Saudi Arabia has not. This division within the GCC is potentially
damaging, as the organisation is supposed to promote economic co-operation
amongst its members and bring some measure of harmony in external trade
relations. The contrasting stances of Saudi Arabia, on the one hand, and the
smaller GCC states, on the other, reflects both differing attitudes towards
Western companies that trade with Israel and differences in economic interests.
On 29 and 30 May 1997 the WTO working party on Saudi Arabia’s
membership application met again, but little progress was made. The United
States had threatened to block Saudi Arabian accession to the WTO unless it
changed its position on the secondary boycott of firms doing business with
Israel. As a consequence, Saudi Arabia’s negotiations with the WTO over its
98 Rodney Wilson
membership application have proved extremely protracted and complicated.
The minister of commerce, Osama Bin Jafar Bin Ibrahim al Faqih, made
intensive diplomatic efforts to get Saudi Arabia admitted by the end of 1997,
but both political and economic obstacles prevented this happening.26 This is
unfortunate, as Saudi Arabia risks being marginalised on international trading
issues if it continues to be excluded from the world body, and the external
negotiating position of the GCC will be weakened if its membership continues
to be divided into those enjoying WTO privileges and those who are not.
There are many vested domestic interests at stake with Saudi Arabia’s
WTO membership bid. The WTO is a much more cohesive organisation than
its predecessor, the General Agreement on Tariffs and Trade (GATT), and
demands much more of its members. The high degree of economic openness
required poses few problems for those economies with only limited industrial
capacity geared to the domestic market, such as the smaller Gulf states, but
for Saudi Arabia, which has a much larger economy and numerous protected
industries, much more is at stake.
The Ministry of Industry and Electricity has supported the development of
new manufacturing ventures for over twenty-five years through its industry
licensing system, which gives protection to local firms under majority Saudi
Arabian ownership.27 New entrants, even locally owned companies, are not
allowed into the market if this would threaten the position of existing
producers. The protected firms have enjoyed access to subsided credit from
the Saudi Industrial Development Fund, and their local monopoly power
ensures that they are seen as a low risk for commercial bank lending.
Tariffs are generally low in Saudi Arabia and the Kingdom has agreed to
move towards a common external tariff with the other GCC states by 2005.28
This will be 5.5 per cent for basic commodities and industrial inputs and
7.5 per cent for consumer goods. Once this is achieved, the GCC will have
evolved from being a free trade area into a customs union.
The WTO working party considering Saudi Arabia’s membership bid has
noted some signs of economic liberalisation. While foreign direct investment
still has to be channelled through locally controlled companies, the market
for portfolio investment was opened up in March 1997 when the Saudi
Arabian Monetary Agency agreed that the Saudi American Bank could launch
a mutual fund designed to attract foreign investment into local equities.
This is designed to track the Saudi Arabian stock exchange index, but the
authorities seem reluctant to allow stock ownership to pass directly into
overseas hands. Permitting foreign ownership of mutual funds is marginal in
relation to the major issue of allowing foreign control of direct investment,
which is of much greater potential significance for trade.
The Kingdom has concluded market access agreements with Japan,
involving lower tariffs on electrical goods, improved standards and certifi-
Saudi Arabia’s political economy 99
cation for imports, and clarification of the rules for foreign involvement in
the construction industry.29 In return for these concessions Japan will now
support Saudi Arabia’s bid for WTO membership. A successful applicant
has to reach agreement with its major suppliers on market access, but
similar agreements have yet to be concluded with the European Union and
the United States.
Saudi Arabia should have no problems with respect to the WTO provisions
on items such as textiles and clothing, but surprisingly the rules on subsidies
to agricultural exports could cause some problems, given the Kingdom’s
grain surpluses. Trade-related aspects of intellectual property rights (TRIPS)
could also result in problems for Saudi Arabian producers of pharmaceuticals
because of restrictions on the local manufacture of generic products. This
issue was raised by the working group on WTO accession in November 1996,
and is certain to be considered again if talks on entry proceed.
Offset agreements could also be affected by WTO membership, as
these involve trade preferences and protectionist measures. In order to
ensure that there are some benefits to the local economy from spending on
defence equipment, offset agreements have been reached with multinational
companies to ensure that such equipment is, where possible, assembled and
serviced in Saudi Arabia. Offset agreements are seen as a way of obtaining
technology, increasing employment, boosting the domestic private sector and
diversifying away from oil through industrialisation.30
In Saudi Arabia there are over twenty major offset programmes worth over
$600 million in foreign direct investment, and these have created employment
for over 1,500 people.31 The major Western countries involved are the United
States, France, Germany and the United Kingdom, with the latter involved
through the Al-Yamamah programme which offset the purchase of Tornado
aircraft. Over ninety British companies are participating in joint ventures
under this programme in the oil, pharmaceutical and consumer goods sectors.
Other offset programmes involve Boeing, General Electric and United
Technologies from the United States. German offset programmes are worth
$540, but only 10 per cent of this is accounted for by German investment, with
the bulk coming from Saudi Arabian joint venture partners.
Conclusions
It is evident that Saudi Arabia faces both political and economic obstacles in
its bid for WTO membership. For Saudi Arabia, one of the greatest benefits
of WTO membership would be its access to the organisation’s trade
settlement procedures. As an outsider, Saudi Arabia cannot take its disputes
before the arbitration panels. Yet this could sort out the problems over
petrochemical exports, and prove a more fruitful avenue to pursue than the
100 Rodney Wilson
bilateral negotiations with the European Union and other interested parties
that have yielded mixed results.
Fiscal policy is becoming more consistent under IMF recommendations,
with government spending kept under tighter control than in the past. This
implies the private sector and multinational companies will have to play
an increasing role in funding commercially viable developments. There is
evidence that this is happening, despite a reluctance to permit foreign ownership of local resources. In the long run, joint ventures which ensure a degree
of local control may be less attractive for foreign partners when most other
countries have fewer ownership restrictions.
In the short and medium term, economic reforms will not necessarily bring
political change, but in the long run, changes in the business culture will
challenge traditional systems of governance and authority. There is the
potential for conflict between economic modernisers and Islamists, but this
can be exaggerated in the economic sphere. Islamic economics and finance
is evolving, and may well propel rather than obstruct reform.
Notes
1 Michel Camdessus (managing director, IMF) The Challenges for the Arab
World in the Global Economy: Stability and Structural Adjustment, Annual
Meeting of the Union of Arab Banks (New York, 20 May 1996), www.imf.org/
external/np/sec/mds/1996/MD9608.HTM
2 ‘Members and Accessions: Becoming a Member of the WTO’ (1999), www.
wto.org/wto/minist/21accs_e.htm
3 British Petroleum, Statistical Review of World Energy (1999), p. 8.
4 Peter Kemp, ‘Revenues Come Right’ Middle East Economic Digest (3 September
1999), p. 2.
5 Saudi Gazette (14 August 1999).
6 Middle East Economic Survey (4 October 1999), p. B1.
7 World Bank Atlas (Washington 1999), p. 25.
8 Middle East Economic Survey (4 October 1999).
9 Henry T. Azzam, ‘Higher Oil Prices and their Impact on Growth Prospects in
the Gulf’, Saudi Economic Survey (8 September 1999), p. 17.
10 Claire Liuksila, Alejandro Garcfa and Sheila Bassett, Fiscal Policy Sustainability
in Oil Producing Countries, IMF Working Paper/94/137-EA.
11 Economist Intelligence Unit, Quarterly Report on Saudi Arabia (3rd quarter
1999), p. 3.
12 Saudi Arabian Monetary Agency, 34th Annual Report, Research and Statistics
Department, 1419 (1998), table 1, pp. 306–7.
13 Robert Trevelyan, ‘Keeping faith’, Middle East Economic Digest (2 July 1999),
p. 2.
14 Middle East Economic Digest, Special Report on Saudi Arabia (17 September
1999), p. 8.
15 Middle East Economic Survey (4 October 1999), p. B3.
16 Middle East Economic Digest (17 September 1999), p. 17.
17 Middle East Economic Digest (13 August 1999), p. 14.
Saudi Arabia’s political economy 101
18 Said A. Al-Shaikh, ‘Foreign Direct Investment in Saudi Arabia’, Saudi
Economic Survey (13 October 1999), p. 12.
19 Tom Everett-Heath, ‘Flowing in’, Middle East Economic Digest (17 September
1999), pp. 2–3.
20 Henry Azzam, ‘Higher Oil Prices and their Impact on Growth Prospects in the
Gulf’, Saudi Economic Survey (8 September 1999), 20.
21 Middle East Economic Survey (10 January 2000), pp. A1–A4.
22 Middle East Economic Survey (4 October 1999), pp. A3–A4.
23 Middle East Economic Survey (18 October 1999), p. A3.
24 ‘Kingdom to Encourage Foreign Investment’, Saudi Gazette (21 October 1999),
p. 1.
25 Saudi Gazette, 22 October 1999.
26 Rodney Wilson, ‘Saudi Arabia: WTO Membership’, Oxford Analytica Daily
Brief (14 May 1997).
27 Ali D. Johany, Michel Berne and J. Wilson Mixon Jr., The Saudi Arabian
Economy (London: Croom Helm, 1986), p. 144.
28 Barclays Bank, Country Report on Saudi Arabia (December 1999), p. 7.
29 BBC Monitoring International Reports, ‘Japan to offer Saudi help on WTO entry
in return for oil’, 10 January 2000, http://globalarchive.ft.com/search/FTJSP
Controller.htm
30 Middle East Economic Digest (21 May 1999), p. 22.
31 Saudi Economic Survey (13 October 1999), p. 19.
5
Dynamics of GCC
press–government
relations in the 1990s
Naomi Sakr
Introduction
Freedoms of expression and information have become standard ingredients
of the recipes for good governance purveyed by development agencies. The
United Nations Development Programme has explicitly included these
freedoms in its criteria for good governance since 1995,1 while World Bank
officials now routinely recommend openness and transparency in policymaking.2 The European Union expects members of the Euro-Mediterranean
Partnership to respect human rights and ‘fundamental freedoms’, including
freedom of expression.3 While such ringing multilateral endorsement of
a political right represents a step beyond these institutions’ earlier preoccupation with economic reform and structural adjustment programmes, the
objective of guaranteeing freedom of expression and information has always
been part of the UN mission. In its very first session in 1946, the UN General
Assembly passed a resolution stating that ‘freedom of information is a
fundamental right and is the touchstone of all freedoms to which the United
Nations is consecrated’.4 Under Article 19 of the 1948 Universal Declaration
of Human Rights,
Everyone has the right to freedom of opinion and expression; this
right includes freedom to hold opinions without interference and to
seek, receive and impart information and ideas through any media and
regardless of frontiers.
It follows from these precepts that media systems form an essential focus of
any study of governance in a society. Yet, although the activities and
associations of so-called civil society in the Middle East have attracted
increasing attention in recent years, detailed studies of the functioning of
either the print or broadcast media in specific country settings have been rare.
This article undertakes a comparative overview of the printed press in the
GCC press–government relations in the 1990s 103
six Gulf Cooperation Council countries, addressing the role it plays in
encouraging debate on local issues. It starts by exploring how the notion of
press freedom might be applied in an empirical study of this kind and
proposing a practical framework within which to analyse the print media in
this, or any, context. It goes on to examine actual relations between governments and the press in the GCC, paying attention to signs of, and reasons for,
change. Widening disparities among GCC member states in this sector are
noted and discussed. The third, concluding, section draws on the evidence to
reflect on the existence of a regional dynamic.
Models of the press
While freedom of expression is a human right that underpins the struggle for
press freedom, judgements about whether the press is more or less free have
to recognise that curbs on freedom take invisible, as well as visible, forms.
Even when subject to minimal legislative controls, the media are not a neutral
channel for the direct exchange of information between governments and
citizens; as institutions they are embedded in existing power structures.
On this basis John Keane has summarised several internal ‘blindspots’ of
classical theories of press freedom. They include oversimplification of the
complex practical processes whereby newspaper owners and their employees
set agendas, frame content, censor themselves, negotiate and compromise in
an uneven marketplace to produce and distribute to a public differentiated by
varying levels of literacy and wealth.5
Broad schematic comparisons of press systems cannot take account of
these complexities. Writing in the 1950s, the American authors of Four
Theories of the Press posited the existence of two basic philosophical
rationales underlying opposing ‘kinds of press’ in the post-war world. On
one side they placed Authoritarian theory, and its latter-day incarnation in
Soviet Communist theory, which conceives of the press as a servant of the
state. On the other side were Libertarian theory and its modification into
Social Responsibility theory, in which the press is seen as watchdog, a check
on government, or a ‘partner in the search for truth’. 6 Four decades later,
another group of American scholars gathered to reappraise the thinking
that produced this normative framework. They decided the time had come
to administer last rites.7 Normative theories, they said, should be treated as
ideologies or historically specific cultural formations. Four Theories ‘seemed
to succeed in mapping all the normative theories because it mapped them
from just one’ [original emphasis].8
Their verdict got to the core of problems with the Four Theories that had
been apparent for a long time. The role played by certain newspapers in the
UK general election of 1992 demonstrated just how little relevance either
104 Naomi Sakr
the Libertarian or Social Responsibility theories had to a large part of the
British tabloid press.9 As for the Soviet Communist theory, studies have
shown how the broadcast media in former Soviet bloc countries departed
from the classic ‘Soviet’ model long before the fall of communism. As Sparks
and Reading have pointed out, the model itself was part of a rhetoric intended
to adduce a striking contrast between the US (commercial) and Soviet (noncommercial) systems. ‘In a broader international comparison’, they write,
‘the contrast appears much less stark’.10
For the same reasons, schematic mapping of press systems in developing
countries is ill advised. The pitfalls are apparent in a comparative study
conducted in the 1980s, which attempted to identify a Third World perspective alongside those of the Western and Communist worlds.11 Despite their
three-pronged approach, the authors still tended to describe a notional Third
World system using the same terminology established for the other two. In
doing so they characterised the Communist model in terms of mobilisation
and propaganda and the Western model in terms of the watchdog function and
‘non-interference with the news’.12 Yet when Herman compared US press
treatment of the shooting down of two commercial airliners – a Libyan plane
downed by Israel in 1973 and a South Korean plane downed by the Soviet
Union in 1983 – he used a propaganda model and found the US media to be
quite capable of undertaking ideological mobilisation.13
Rugh, in his famous 1970s study of the Arab press, concluded that the ‘real
dynamics’ of press systems in Arab countries could only be grasped in the
light of political and other conditions prevailing in a specific country at a
specific time.14 For convenience he assigned newspapers across the Arab
world to one of three categories: ‘mobilisation’, ‘loyalist’ and ‘diverse’. But
he acknowledged that the three types were not static or permanent and that
the same country could experience each type over time. In the light of his
findings, Rugh argued that ‘neither the media nor their environments can be
understood properly without reference to the other’.15
In other words, the media are not self-contained or monolithic; the press
and wider aspects of governance are intertwined. Just as the state is not a
unitary phenomenon, but a cluster of institutions and personnel that are often
disunited,16 so the media are implicated in these cleavages and, whether
obviously or not, are sites of struggle between contending forces.17 GCC press
debate about sensitive political, social and economic issues can be viewed in
this light. Opposition between reformist and conservative camps within a
single government is one type of conflict that may be reflected in the press.
Splits within a single ruling family are another. But there may be other, more
subtle contradictions. A journalist working for a newspaper owned by the
Ministry of Information might be a government employee but still aspire to
playing a watchdog role. A privately owned publishing company may owe
GCC press–government relations in the 1990s 105
its existence to the incumbent regime but switch allegiance if this will help
it to survive.
Thus it is not a simple question of whether the press is owned by the
state or by private individuals or whether newspaper content is formally
censored or not. The handling of debate about local issues depends on a multidimensional array of factors, starting with structural regulation and legislation
controlling content but also including the identities of newspaper publishers
and editors, the composition of readerships, the liveliness and openness of
debate in the parliament or consultative council, transnational influences,
cross-media influences and the status and treatment of journalists.
Development and divergence
On nearly all these criteria, marked differences emerged among the six GCC
states during the course of the early 1990s. A comparison of press laws in
force at the start of the decade would have shown that all of them imposed
prison sentences for such vaguely worded offences as ‘criticising the ruler’,
‘disseminating false information’, ‘disturbing public order’, or ‘harming’
national unity, public morality or relations with friendly states. The main
difference from one country to the next was in whether the length of the prison
sentence incurred for such offences was measured in months or years.18
All had information ministries running the broadcast media and enforcing
press censorship through licensing of publications, obligatory deposit of
newspapers before (or, in the UAE, at the time of) distribution, registration
of journalists and so on.
Similarly, a comparison of the available forums for debate would have
shown that only Oman and the UAE had consultative councils in operation
at the start of the 1990s, and that these were appointed bodies with very
limited scope. The first elections to Oman’s consultative council only took
place in 1997. Kuwait’s elected parliament had been dissolved in 1986 and
was not reconvened until 1992. Bahrain’s National Assembly was dissolved
in 1975 and the Consultative Council formed at the end of 1992 was appointed
by the emir. Saudi Arabia’s Consultative Council, proposed in 1962, was
established by appointment thirty years later. Deliberations on creating an
elected parliament for Qatar did not start until 1999.
Satellite television was just arriving in the Gulf at the start of the 1990s.
It was not until after Iraq invaded Kuwait in August 1990 that the Egyptian
government, through the Egyptian Radio and Television Union, launched the
Egyptian Space Channel to serve Egyptian troops and other listeners in
the Gulf. The Saudi-owned Middle East Broadcasting Centre (MBC) started
up from London in September 1991. Neither ESC nor MBC were interested
in breaking existing censorship rules restricting political programming,19
106 Naomi Sakr
so it was not until other pan-Arab channels joined the satellite scene in
the mid-1990s that cross-media ramifications of the new medium of satellite
broadcasting began to be felt.
In the same way, the rise of the expatriate pan-Arab press and diaspora
journalism was a phenomenon of the 1990s. The Saudi-owned Asharq
al-Awsat had started in London in 1979, but it was not until 1990 that
the Lebanese daily Al-Hayat was resurrected with Saudi money and also
published from a London base. The Palestinian Abu Zuluf family, owners of
the Jerusalem daily Al-Quds, set up the London version, Al-Quds al-Arabi in
1989. Originally directed at Palestinians in the Gulf, Al-Quds al-Arabi was
left floundering when Palestinians were forced to leave the Gulf during the
crisis of 1990–1. It was after a change of ownership and editorial direction
that Al-Quds al-Arabi started to make its mark.
Iraq’s invasion of Kuwait and its aftermath was just one factor in the
rapid demographic changes that affected the composition of newspaper
readerships in the Gulf during the 1990s. What amounted to a baby boom in
the wake of the mid-1970s upturn in the Gulf states’ economic fortunes started
to feed into changes in the job market as the 1990s wore on. At the start of
the 1990s, controversy around the issue of expatriate labour was limited.
In contrast, the end of the decade was marked by acute anxiety over the
rising tide of young unemployed Saudis, Bahrainis, Omanis and even Qataris,
among whom literacy rates and consequent receptiveness to the print media
were substantially higher than those of the previous generation. Adult
literacy in Saudi Arabia was 73 per cent in 1997, compared with just 9 per
cent in 1970.20
Meanwhile, as the proportion of people aged under 25 rose dramatically,
so the age gap widened between elderly GCC rulers and the majority of the
GCC population. It was not until the second half of the 1990s that a coup in
Qatar and the death of the emir in Bahrain brought the first of a new generation
of heads of state to the helm. The tensions these changes produced within the
ruling families of Qatar and Bahrain were mirrored by emerging splits over
succession arrangements between different branches of other GCC ruling
families, notably those of Kuwait and the UAE.
Qatar
Against this rapidly evolving socio-economic landscape, media practice in
individual GCC countries developed during the 1990s along diverging paths.
The direction of Qatar’s shift away from earlier norms was set when Shaikh
Hamad bin Khalifa Al Thani ousted his father and took over as emir in June
1995. Within four months of his takeover, Shaikh Hamad’s government
announced that it planned to end press censorship to prove its ‘trust in the role
GCC press–government relations in the 1990s 107
of the press’.21 In February 1996 the Qatari cabinet decided to abolish the
Ministry of Information. The outgoing minister of information and culture,
Hamad Abdel-Aziz al-Kuwari, expressed pleasure that Qatar had become the
first Arab country to take such a step. It was an experiment, which, he said,
would serve those in positions of responsibility by doing away with secrecy
and enabling them to ‘feel the people’s pulse’.22 Later that year Qatar achieved
another first by agreeing to the 24-hour relay of British Broadcasting
Corporation (BBC) programmes from Doha on FM. This agreement meant
that BBC radio programmes in Arabic and English would be available on
FM in the Arab world for the first time. It also included provision for Qatari
broadcasters to be trained by the BBC.23
Qatari officials were clear that dismantling the traditional censorship
apparatus might be unusual in an Arab country but was by no means unusual
in other parts of the world.24 They seemed to have been prepared for the
political fall-out incurred as a result of airing discussion programmes with
opposition figures from across the region who, far from having access to the
media in their own countries, would probably be sent to prison if they returned
there. Much has been written about the background to Qatar’s Al-Jazeera
satellite channel, which started up in late 1996 but did not become widely
available to satellite viewers until November 1997.25 The focus of this chapter
is not television but the press. In shifting focus, however, it is worth
noting that Qatari radio and the press played host to Bahraini dissidents even
before Al-Jazeera was launched. Given the border dispute between Qatar and
Bahrain over the Hawar islands, and support for Bahrain’s position from other
Gulf states,26 Qatar’s use of its media for political point-scoring in this fashion
was quite in keeping with regional traditions. Speaking on Qatari radio in
January 1996, Mansour al-Jamri of the Bahraini opposition drew attention to
his close relations with Qatar. He said he had repeatedly called for ‘dialogue
between the decision-maker and the citizen . . . on the BBC, the radio and
TV [and in] weekly articles in the national press in Qatar’.27
Critics of the Qatari government’s approach to the media claimed that the
emirate was giving itself the freedom to tackle topics that were sensitive in
other Arab countries while keeping controversial aspects of domestic politics
off-limits. Qatari officials rejected this criticism with some justification. In
June 1999 both government-owned radio and the press broke a long-standing
taboo in the Gulf region by allowing callers and columnists to complain about
the privileges enjoyed by the Qatari ruling family. Several speakers on a
morning radio phone-in debate called for a reduction in the allowances paid
to members of the Al Thani and one described the ruling family as a ‘big
emotional and financial weight on the nation and its people’.28 The talk show
host, Abdel-Aziz Mohammed, said the debate proved there were ‘no more red
lines’ for the Qatari media.
108 Naomi Sakr
The Doha newspaper, Al-Raya, followed up the radio programme by
publishing an editorial on the same subject. It said: ‘While Qataris are
suffering from unemployment, lack of adequate housing and reduction of
government subsidies . . . the ruling family continues to enjoy privileges’.29
In October 1999, in an interview with Al-Hayat, the foreign minister, Shaikh
Hamad bin Jassem bin Jabr Al Thani, listed instances in which he and Qatari
government policies had come under attack from Al-Jazeera among others.
Judging from the amount of criticism, he said, ‘you would think that [Qatar’s]
population numbered 50 million rather than half a million’.30 Of media
comment on the Gulf Cooperation Council he said: ‘. . . if we want [the GCC]
to get stronger, we have to let our peoples know about our differences. They
have a right not to be left in the dark’.31
The United Arab Emirates
Unlike Qatar, the UAE still has an information ministry, headed by Shaikh
Abdullah bin Zayed (a son of the president) since 1996. Like ministers in
Qatar, however, Shaikh Abdullah publicly welcomes the idea of media
freedom. He told a conference of Gulf newspaper publishers in Abu Dhabi
in March 1998 that any attempt to place constraints on the free flow of
information was futile. The UAE authorities believed, he said, that the press,
besides providing information, should act as the ‘conscience of society’,
identifying failure as well as celebrating success. They also believed that the
best way to dilute any negative effect of incoming foreign media was to ensure
that the UAE’s own domestic media was of ‘such a quality that it could
provide an attractive alternative view’.32 Shaikh Abdullah announced to the
conference that the UAE was in the process of making amendments to its
federal Press and Publications Law based on this understanding of the role
of the press. Two years later the final draft of that law had still not been
released. In the meantime, however, several developments suggested that the
status of the media in the UAE was being upgraded and that government
policies and ministerial performance could be openly criticised, whether in
the press or the Federal National Council.
Whereas the Qatari regime allows the media to break taboos as a form of
muscle flexing within the GCC, the UAE authorities’ rationale for holding
back on censorship is that a thriving regional business centre needs a credible
press. A concentration of foreign businesses in the UAE means a concentration of expatriates, with access to alternative sources of news and analysis,
and competition among both English-language and Arabic dailies in a small
but lucrative market. Money spent on advertising, measured per head of the
population, is higher in the UAE than in other GCC states.33 Two privately
owned English-language dailies, Gulf News and Khaleej Times, reportedly
GCC press–government relations in the 1990s 109
earned around $31m each in advertising revenue in 1997, while the Sharjahbased Arabic daily Al-Khaleej earned nearly $23m.34 Aware of potential
future profits to be made from the information industry, Sheikh Mohammed
bin Rashed Al Maktoum, crown prince of Dubai and defence minister of the
UAE, announced in October 1999 that Dubai was creating an Internet City.
Companies in the city could be 100 per cent foreign owned, exempt from tax,
and benefit from sophisticated telecommunications and logistical support,
including an Internet University.35 At the start of 2000, the Internet City
project was officially linked to a Media Free Zone.
With competing media free zones springing up in other Arab countries,
notably Egypt, Jordan and Bahrain, prospective investors were expected to
judge the Dubai venture not only in terms of business freedoms but also in
terms of the availability of skilled labour and freedom from onerous controls
on media content. It was apparently on this basis that Shaikh Mohammed, in
addition to promoting the Internet City and Media Free Zone, intervened
personally to provide local journalists with the means to enhance their
status and become more familiar with new technology and diverse sources
of information. The new press club he opened in November 1999 offered free
access to international news agencies and the internet from 9am to 11pm.36
He also put money into forming the UAE Journalists’ Association and
creating a trust fund for its members, saying that this was one way of defending the rights and freedoms of journalists and boosting the number of Emirati
journalists in the UAE.37 Shaikh Abdullah bin Zayed publicly praised Shaikh
Mohammed’s support for journalism and the ‘exchange of ideas’.38
None of this means there is no press censorship in the UAE. Instead of
government officials vetting newspapers before distribution, Shaikh Abdullah
meets newspaper editors once a month to ensure that, if they have material
that is likely to ‘shake a few branches’, they do not shake the wrong ones.39
But the UAE press derives strength from the state’s federal make-up. The
presence of seven ruling families gives private publishers more opportunities
to exert influence through personal connections. At the same time, the
multiple layers of local and federal government give rise to conflicting official
policies and perceptions, which can be played off against each other by the
press. Thus it is up to individual editors to test the boundaries of what can and
cannot be published in the UAE. Precedents have been set for investigative
journalism in organs such as Gulf News and Al-Khaleej and allegations of
corruption have been aired. To cite two examples: in 1999, the press reported
clashes over alleged irregularities in the federal Ministry of Health; and in
early 2000 there were press reports on drug trafficking in the region, based
on journalistic research that had been going on for years.
110 Naomi Sakr
Kuwait
The more newspaper editors assert their right to comment on national affairs,
the more they push at the imprecise boundaries laid down in vaguely worded
prohibitions contained in press laws, and the more chance there is that
the regime will be tempted to invoke these laws. Controls on the Kuwaiti
press have come and gone during the last forty years, in a process closely
linked to the dissolution and convening of parliament, and to the state of
relations between cabinet ministers and MPs. The Kuwaiti parliament has
been televised since February 1999, despite government objections based
on the frequency with which MPs call ministers to account. The political
participation of MPs is mirrored in the extent to which national politics feature
in Kuwait’s five Arabic-language national dailies. Four of these, Al-Qabas,
Al-Anbaa, Al-Siyassa and Al-Watan, have had run-ins with the authorities.
Mohammed al-Saqr, the editor-in-chief of Al-Qabas since 1983, received a
press freedom award from the US-based Committee to Protect Journalists in
1992. He attributed his paper’s success to its ability to function without
government advertising or government subsidies and to non-interference on
the part of the five merchant families who own it.40
Al-Siyassa has also built a reputation for serious journalism under its
proprietor and editor-in-chief, Ahmad Jarallah, who turned the paper from a
weekly into a daily. Al-Watan has reportedly enjoyed more editorial freedom
since being bought by Kuwait’s former oil minister, Shaikh Ali Al Khalifa,
after the Gulf War and being made part of a diversified publishing house.41
Al-Anbaa, on some reports the most widely circulated newspaper in Kuwait,
boosted its editorial team in the mid-1990s by recruiting staff from the
respected Lebanese daily, Al-Nahar.42 As these papers tried to report
freely on local politics in the second half of the 1990s, government sanctions
against them intensified, culminating in early 2000 in a situation where two
papers, Al-Siyassa and Al-Watan, were saved from closure only through the
intervention of the emir.
Before the Gulf War, the dissolution of parliament in 1986 was
accompanied by the introduction of reporting restrictions even tighter than
those contained in the 1961 press law. After the war, in 1992, the government
succumbed to international pressure in favour of political liberalisation by
revoking pre-publication censorship. This was a small concession, given that
pre-transmission censorship was kept for the broadcast media, along with
judicial powers to suspend newspapers or shut them down and send journalists
to jail. Under these rules, Al-Anbaa was suspended for four days in 1995 for
running interviews with representatives of different religious and political
tendencies in Kuwait. The cabinet, in ordering the suspension, said such
interviews went ‘against the national interest’.43 In an effort to stifle coverage
GCC press–government relations in the 1990s 111
of public affairs, the government also banned civil servants from writing in
the press.44
In 1998–9 the editors of Al-Qabas and Al-Siyassa were penalised for
publishing items said to be blasphemous or immoral, in what looked like an
attempt by the authorities to placate Islamist MPs who had protested about
the display of banned books in a Kuwaiti book fair in 1997. In October 1999,
however, Al-Siyassa was banned yet again, for five days, this time for
reporting remarks made by an Islamist, Hamid al-Ali, criticising an emiri
decree and the US. According to the cabinet, the act of reporting such
remarks undermined the emir’s dignity and the national interest.45 Undaunted,
Kuwait’s newspapers devoted increasing attention to the question of who
might succeed the crown prince and prime minister, Shaikh Saad al-Abdullah
Al Sabah. Shaikh Saad, head of every cabinet since 1978, returned to Kuwait
in January 2000 after a prolonged absence for medical treatment in the US
and UK. Soon after Shaikh Saad’s return, the press carried a statement by the
liberal Democratic Forum alleging ‘stagnation and paralysis’ in the country’s
‘political management’ and an ‘inability to face major challenges’.46
When the first deputy prime minister and foreign minister, Shaikh
Sabah al-Ahmad Al Sabah, responded by telling journalists they were free to
criticise the government but not the ruling family, the impossibility of doing
one without the other was made plain. The posts of prime minister, foreign
minister, minister of defence and minister of the interior have all regularly
been held by members of the ruling Al Sabah. A government attempt to
withdraw Al-Siyassah’s licence to publish and close down Al-Watan for two
years, on grounds that they had fabricated an emiri decree, triggered a major
clash. All five editors-in-chief of Kuwait’s Arabic language dailies, including
the usually placid Al-Rai al-Aam, condemned the information minister for
allegedly failing to take their side. MPs accused the government of taking
‘mad’ and ‘sick’ decisions.47 On 15 February 2000, the emir stepped in to
defuse the crisis by cancelling government sanctions against Al-Siyassa and
Al-Watan. Meanwhile, Kuwaiti editors had gathered ammunition in their
campaign for a new, more enlightened, press law.
Bahrain
The heated and open struggle over censorship in Kuwait was closely observed
in Bahrain in the wake of the change of leadership there in 1999. Under the
former emir, Sheikh Isa bin Salman Al Khalifa, who ruled the country for
nearly forty years, freedom of expression was one of many civil and political
rights denied to the population. More important than Bahrain’s 1979 press law
was its 1974 Law on State Security, which authorised the interior minister to
arrest anyone suspected of questioning the emirate’s security or its economic
112 Naomi Sakr
or social foundations. The privately owned daily, Akhbar al-Khalij, was
suspended for three days in July 1993 after publishing a map on which the
disputed Hawar islands were shown as belonging to Qatar.48 Two months
later the paper’s features editor, Ali Saleh, was sacked for trying to run an
interview with the leading Shia dissident, Shaikh Abdel-Amir al-Jamri.
Al-Jamri himself was subsequently detained without trial. In 1995, at a time
of internal disturbances over calls for political reform, two journalists who
spoke about the unrest to the BBC were arrested and held for two weeks.49
With the death of Shaikh Isa in March 1999 and the accession of his son,
Shaikh Hamad bin Isa, the political climate showed signs of change. Shaikh
Hamad ordered the release of Shaikh Abdel-Amir al-Jamri and hundreds of
other political detainees and created a human rights committee within the
Shura Council. Announcing a far-reaching but vague reform programme in
December 1999, the new emir urged writers to ‘express the people’s aspirations freely’ and called on state officials to ‘accept constructive criticism’.50
By then journalists in Bahrain had already drawn attention to changes in
the media elsewhere in the Gulf. In one such article in Al-Ayyam, Sawsan
al-Shaier had cited developments in Qatar, the UAE and Kuwait to argue that
the only service a government-controlled press can provide is that of ‘spindoctoring’. The independence of the media, she said, was no less important
than that of the judiciary.51
Oman
Included in Sawsan al-Shaier’s examples of developments in the GCC media
were calls in Oman for the Information Ministry to be scrapped and the media
to be privatised. However, while such policy prescriptions may be aired in
some forums in Oman today, this does not yet mean they receive media
coverage.52 Although Internet access has been available since the end of
1996,53 media liberalisation in Oman is still at an early stage. Two of Oman’s
five daily newspapers, Oman and Oman Observer, are government controlled
and the other three exercise self-censorship. All the country’s media have had
a short history, having been launched only in 1970 following the accession of
Sultan Qaboos.
Oman has the lowest adult literacy rate in the GCC, at 67 per cent in 1997
compared with rates of 73 per cent in Saudi Arabia, 75 per cent in the UAE,
80 per cent in Qatar and Kuwait and 86 per cent in Bahrain.54 Newspaper
circulation remains very low, with the most widely read daily, the privately
owned Al-Watan (printed outside Oman during its initial years), estimated to
sell fewer than 30,000 copies in a population of 2.3 million. By comparison,
some Kuwaiti papers sell twice this number to a population of less than 1.9m,
while in the UAE, with a population of 2.7m, the leading dailies claim
GCC press–government relations in the 1990s 113
circulations of 70,000–80,000.55 Officials in the Omani Ministry of
Information still view the press as a tool for nation-building and ‘reinforcing
social integration’, and there is a concern to ensure that the Omani press
develops through the efforts of Omani rather than foreign journalists.56 This
will take time and a major training effort. It will mean, however, that
newspapers are produced by people who have a personal stake in the affairs
they cover, at a time when Oman’s partially elected Majlis al-Shura is also
breaking new ground by calling government ministers to account.
Saudi Arabia
The GCC country missing from Sawsan al-Shaier’s list was Saudi Arabia.
On the spectrum of open press debate in the GCC, Saudi Arabia lies at
the opposite end from Qatar. Saudi censorship is so stringent that the development of Saudi-owned media institutions has mainly had to take place abroad.
The two expatriate dailies, Asharq al-Awsat and Al-Hayat, circumvent
some of the most onerous local censorship procedures but are nevertheless
economically dependent on the Saudi market, which means they have to avoid
content that would obstruct their entry. Article 39 of Saudi Arabia’s 1992
Basic Law gives an indication of the restrictions imposed on the press.
It forbids publication of anything that can ‘lead to internal strife or division,
or negatively affect the security of the state, or its public relations, or degrade
man’s dignity and rights’.57
The 1965 National Security Law criminalises the acts of criticising
the government or ‘interfering’ in political affairs. The 1982 Press and
Publications Law stipulates that freedom of expression may not exceed the
limits of Sharia or existing statutes. Article 6 of the law lists 12 prohibitions
on content. It is forbidden, for example, for virtually any form of critical
comment about people in power to appear in print and the same applies to
publication of state agreements or communiquès prior to their official release.
Article 33 empowers the Ministry of Information to confiscate or destroy
without compensation any offending issue of a newspaper, while Article 38
subjects violators to imprisonment or a fine, or both. All foreign media are
censored to ensure they comply with the 1982 press law, and the entry of
foreign journalists is tightly restricted.
These laws are enforced by several institutions, from the Supreme
Information Council, the General Directorate of Publications and the
Department of Press Censorship to the offices of provincial governors. In
the 1980s there were numerous incidents involving dismissals, detention and
harassment of high-ranking Saudi editors and journalists who attempted to
criticise ministries or foreign governments, expose corruption or question
national customs.58 In the 1990s, such criticism was mostly voiced outside
114 Naomi Sakr
the mass media, in the faxes and e-mails sent from abroad by members of
the suppressed Committee for the Defence of Legitimate Rights and on
clandestine audio cassettes distributed by Islamist groups associated with the
Buraydah demonstration of 1994. In contrast, newspapers and television
programmes destined for consumption inside Saudi Arabia steered clear of
contentious aspects of Saudi politics. Even Al-Hayat, with its reputation for
being more outspoken than Asharq al-Awsat, was edited with a view to risking
the occasional one-day ban but never an indefinite ban.59
Saudi newspapers published internally have a strong regional focus. Okaz
serves the western regions of the Hejaz and Asir, Al-Riyadh is dominant in
the central region of Nejd, Al-Madina and Al-Nadwah circulate in Madina and
Makkah respectively and Al-Yawm is the main paper for the Eastern Province.
As a result, Asharq al-Awsat is effectively regarded as the kingdom’s only
national daily. It is all the more noteworthy, therefore, that Asharq al-Awsat
carried several articles in 1999 explicitly calling for change in the way that
Saudi Arabia is governed. The prominent Saudi columnist, Turki al-Hamad,
wrote in his weekly think-piece for a weekend edition of Asharq al-Awsat
in June that Saudi Arabia could no longer stand aloof from the rest of the
world. It was no longer possible, he said, to ‘apply the criteria and controls
of a simple society’ to a society that had become globalised and complex.
Remaining silent on the precise changes needed, Turki al-Hamad had one
clear argument: ‘In an age like ours, change has become the only route to
social and political stability’. Successive Saudi governments had tried to keep
up with changing times, he said, and they had been successful in maintaining
stability so far. But, the columnist cautioned, ‘Yesterday’s success does not
ensure ongoing success. Indeed, yesterday’s success could itself become an
obstacle to success today or tomorrow’.60
A few months later, another Asharq al-Awsat columnist took issue with an
aspect of Saudi governance directly related to the role of the press. Deploring
the military secrecy surrounding even the smallest piece of information in the
kingdom, Abdel-Rahman al-Rashed listed the types of data that are unavailable in Saudi Arabia. He wondered aloud how a country could possibly hope
to plan ahead without gathering and sharing information. ‘Without accurate
information’, he wrote, ‘decision-makers are like the blind who don’t know
if they are stepping into a pit, or onto a pavement or killer highway.’ ‘Making
information available is a necessity dictated by the interests of individuals,
firms and governments.’61
Such a comment may have seemed unusually forthright. But it was also in
tune with the thinking of the reformist camp within the Saudi government,
led by Crown Prince Abdullah himself. At precisely the time Asharq al-Awsat
was venturing to recommend a reorientation of government policy, the
crown prince was declaring the urgency of making the legal and economic
GCC press–government relations in the 1990s 115
adjustments needed to prepare Saudi Arabia for membership of the World
Trade Organisation. During the last months of 1999, several Saudi ministers
promised major legislative changes on corporate taxation, foreign property
ownership and access to the stock market, with the aim of attracting foreign
investment. Those in favour of change were well aware of the weighty conservative opposition they faced. Against this background, Asharq al-Awsat’s
recommendations demonstrated that the organisation, regulation and content
of the press in any society could help to illuminate splits and linkages between
different political and social groups.
Conclusion
It can be argued, on the evidence presented here, that significant change did
occur during the late 1990s in the extent to which newspapers in the GCC
were prepared to test and question local censorship and comment on issues
of governance in their own countries. But it can also be argued that, in doing
so, the newspapers in question were responding to, and reflecting, wider
changes in their societies and representing political and economic interests
that were by no means exclusive to the media. If press comment on issues such
as corruption, economic reform or the role of the ruling family is actually
published and distributed, it is because there are relatively powerful political
forces behind such ideas in the country concerned.
The evidence has also shown how the precise nature of relations between
press and government is different in every one of the six GCC states and that,
as change in countries such as Qatar and Kuwait accelerated, the differences
grew more marked. Despite these differences, however, a regional dynamic
could also be discerned. It could be seen in Bahraini journalists’ wistful
observations on development of the press in neighbouring states, and their
implication that freedoms granted in Qatar, the UAE and Kuwait, and called
for in Oman, should also be extended to Bahrain. It could be seen every
time a newspaper under Gulf ownership, whether Al-Hayat or one of the
Kuwaiti dailies, conducted an interview on the subject of press regulation
with representatives of the government of Qatar. Elections and parliamentary activity in Kuwait, Qatar or Oman provided both the precedents and
vocabulary of political participation for press debate conducted elsewhere in
the GCC.
Finally, the training and employment of local journalists is a development
that feeds into the regional dynamic. As expatriates were being phased out
and Omani, Emirati or other GCC nationals phased in or promoted, journalists’
engagement with national and regional current affairs was bound to grow. As
the 1990s closed, the days when GCC newspapers devoted the bulk of their
coverage to safe but distant international topics appeared to be numbered.
116 Naomi Sakr
Notes
1 T. Niblock, ‘Democratization: A Theoretical and Practical Debate’, British
Journal of Middle Eastern Studies 25, no. 2 (November 1998), p. 231.
2 The World Bank President James Wolfensohn, addressing the 2nd Mediterranean
Development Forum in Marrakesh in September 1998, spoke in favour of
‘democracy and freedom’, ‘the growth of civil society’, ‘social justice’, ‘access to
information’ and ‘transparency’.
3 Appendix 2 of The Euro-Mediterranean Partnership: Barcelona Declaration
and Working Programme (Brussels: European Commission, DG1B, November
1995).
4 Resolution 59 (I), 14 December 1946.
5 J. Keane, The Media and Democracy (Oxford: Polity Press, 1991), pp. 35–50.
6 F. Siebert, T. Peterson and W. Schramm, Four Theories of the Press (Urbana:
University of Illinois Press, 1963), p. 3.
7 J. Nerone (ed.), Last Rights: Revisiting Four Theories of the Press (Urbana:
University of Illinois Press, 1995). The title is an intentional pun.
8 Ibid., pp. 182–4.
9 J. Petley, ‘The Fifth Theory of the Press’, paper presented to the Campaign for
Press and Broadcasting Freedom conference at City University, London, March
1994.
10 C. Sparks and A. Reading, ‘Understanding Media Change in East Central
Europe’, Media, Culture & Society 16 (1994), p. 252.
11 L. J. Martin and A. Grover Chaudhary (eds) Comparative Mass Media Systems
(White Plains, NY: Longman Inc., 1983).
12 Ibid., p. 20.
13 E. Herman, ‘Gatekeeper versus Propaganda Models: A Critical American
Perspective’, in P. Golding, G. Murdock and P. Schlesinger (eds) Communicating
Politics: Mass Communications and the Political Process (New York: Holmes &
Meier, 1986), pp. 175 and 194.
14 W. Rugh, The Arab Press: News Media and Political Process in the Arab
World, revised 2nd edition (New York: Syracuse University Press, 1987),
p. 167.
15 Ibid., pp. 164–7.
16 P. Abrams, ‘Notes on the Difficulty of Studying the State (1977)’, Journal of
Historical Sociology 1 (1) (March 1988), pp. 67–81.
17 J. Curran, ‘Rethinking the Media as a Public Sphere’, in P. Dahlgren and
C. Sparks (eds) Communication and Citizenship: Journalism and the Public
Sphere (London: Routledge, 1991), p. 29.
18 The press laws of all six GCC states at the start of the 1990s are reproduced in
A. Derradji, Le droit de la press et la liberté d’information et d’opinion dans
les pays arabes [Press law and freedom of information and opinion in Arab
countries] (Paris: Publisud, 1995), pp 168–92, 206–17, 317–40.
19 See, for example, the content analysis conducted by M. Ayish, ‘Arab Television
Goes Commercial’, Gazette 59 (December), pp. 473–93.
20 This remarkable statistic, contained in the UNDP’s Human Development Report
1997 (Oxford: Oxford University Press, 1997), p. 166, is borne out by data in
D. Holden and R. Johns, The House of Saud (London: Pan Books, 1982), p. 259.
Comparable early data are not available for Bahrain, Qatar or Oman.
21 Reporters sans frontières, 1996 Report: Freedom of the Press throughout the
World (Luton: John Libbey Media, 1996), p. 205.
GCC press–government relations in the 1990s 117
22 Interview with Al-Hayat, 11 February 1996.
23 BBC World Service press release, London, 4 November 1996
24 Author’s telephone interview with Mohammed Jassem al-Ali, director of
Al-Jazeera satellite channel, from Doha, 27 May 1998. See also Dr Kuwari’s
interview with Al-Hayat, cited in note 22.
25 See, for example, N. Sakr, ‘Daring to Talk’, The World Today 54 (12) (December
1998), pp. 321–3; N. Sakr, ‘Satellite Television and Development in the Middle
East’, Middle East Report 210 (Spring 1999), pp. 6–8; N. Sakr, ‘Frontiers of
Freedom: Diverse Responses to Satellite Television in the Middle East and North
Africa’, Javnost/The Public 6 (1) (1999), p. 101.
26 Economist Intelligence Unit, Bahrain Country Profile 1999–2000, p. 9.
27 BBC Summary of World Broadcasts, ME/2519 MED/15–16, 26 January 1996.
28 Associated Press report from Doha, 19 June 1999.
29 Ibid.
30 Al-Hayat website, 2 October 1999.
31 Ibid.
32 ArabAd 8 (4) (April 1998), p. 37.
33 Pan-Arab Research Centre data for 1998 (reproduced in ArabAd 9 (2) (February
1999), p. 46) show a total of $195m for the UAE, compared with $350m in
Saudi Arabia, $173m in Kuwait and $30m–35m in Oman, Bahrain and Qatar.
34 Arabies-Trends, September 1998, p. 54.
35 Gulf News, 30 October 1999.
36 Gulf News, 10 November, 1999.
37 Gulf News, 1 February 2000.
38 Ibid.
39 Author’s interviews with journalists in the UAE, 20–22 October 1997.
40 ‘Muhammad al-Saqr on Kuwait’s Press’, Middle East Report 180 (January–
February 1993).
41 ArabAd 8 (11) (December 1998), p. 64.
42 Ibid., p. 49.
43 Reporters sans frontières, op. cit., p. 182.
44 Ibid.
45 http://www.arabicnews.com, 18 October 1999.
46 Translation as given in Gulf News, 9 February 2000.
47 Reuters report from Kuwait, 15 February 2000.
48 Reporters sans frontières, 1994 Report: Freedom of the Press throughout the
World (London: John Libbey & Company, 1994), p. 38.
49 Reporters sans frontières, 1996 Report (op. cit.), p. 205.
50 Gulf News, 27 December 1999.
51 Translation from report in Gulf News, 7 November 1999.
52 See, for example, the US Department of State, Bureau of Democracy, Human
Rights and Labor, 1999 Country Report on Human Rights Practices in Oman,
Washington, February 2000.
53 For discussion of Internet censorship in Bahrain, Saudi Arabia and the UAE see
Human Rights Watch, The Internet in the Mideast and North Africa (New York:
Human Rights Watch, June 1999).
54 UNDP, op. cit., pp. 134–5.
55 Circulation and population data collated from Pan-Arab Research Centre and
Economist Intelligence Unit respectively.
118 Naomi Sakr
56 See, for example, the statement by Hamad al-Rashidi, secretary of state for
information, quoted in Arabies Trends 16 (January 1999), p. 52.
57 Translation taken from Human Rights Watch/Middle East, Empty Reforms:
Saudi Arabia’s New Basic Laws (New York: Human Rights Watch, May 1992),
p. 33.
58 ARTICLE 19, Silent Kingdom: Freedom of Expression in Saudi Arabia (London:
ARTICLE 19, 1991), pp. 22–5.
59 The calculations involved are discussed by Jihad Khazen in A. Atwan and
J. Khazen, ‘In the Saudi Pocket’, Index on Censorship 2 (1996), pp. 51–3.
60 Asharq al-Awsat, 24 June 1999. Translated in Mideast Mirror, 24 June 1999,
pp. 11–13.
61 Asharq al-Awsat, 20 October 1999. Translated in Mideast Mirror, 20 October
1999.
6
Climate governance in the
GCC
Christiaan Vrolijk
Introduction
Good environmental governance in the Gulf states is taking place. A recent
study by the Crown Prince Court in Abu Dhabi and the Royal Institute of
International Affairs described various environmental policies that have been
put in place in recent years.1 Initiatives on water shortages and conservation,
prevention of and responses to oil spills, other environmental challenges and
sustainable development are all under way. Specifically, this chapter will
look at the role of the Gulf Cooperation Council (GCC) countries in the
climate change debate. However, in the true spirit of a remark made by a
Saudi negotiator at a recent climate change meeting about ‘best practice’ that
we should also look at ‘worst practice’, this chapter will discuss the uncooperative role of many OPEC countries in the international climate change
negotiations.
This chapter will first briefly explain the problem of global climate change
that the world is facing. The next section will describe the response of the
international community in negotiating global agreements. This is followed
by an analysis of the role of the GCC in these international negotiations, and
the arguments that have determined its response. Following one of these
arguments, further details of the economic impact of the Kyoto Protocol are
considered. Finally, some recent developments are described, including the
fuel protests that rocked Europe in late 2000 and the failed climate summit
in The Hague of 13–24 November 2000.
Climate change
The Intergovernmental Panel on Climate Change (IPCC), set up by the UN
Environment Programme and the World Meteorological Organisation,
concluded in its 1995 Second Assessment Report that ‘the balance of evidence
suggests a discernible human influence on global climate’.2 A lot has
120 Christiaan Vrolijk
happened since then: scientific understanding has increased, the modelling
has improved, and many ‘freak’ events have occurred that could be attributed
to climate change. The temperature record also gives much stronger evidence
of warming: the eight warmest years on record have all occurred since 1990.3
Three major scientific reports on the status of the world’s climate have
been agreed. The Intergovernmental Panel on Climate Change (IPCC) reports
every five years on the latest science related to climate change. In 2001, its
Third Assessment Report will be published; the reports of the three Working
Groups have now been accepted, and the synthesis report is due out soon.4
The key messages from these reports are:
1
2
3
The climate is changing, and it is caused by human activity. Working
Group I said: ‘most of the warming [so far] is attributable to human
activities’, and ‘human influences will continue to change [the atmosphere]’. Of course, gaps in the science remain.
Socio-economic and natural systems are vulnerable to changes in the
climate, and costly problems could arise.
Working Group II, focusing on the vulnerability of socio-economic and
natural systems to climate changes, said that recent climate changes ‘have
already affected many systems’, and that ‘many natural systems are
vulnerable to climate change’. Some key problems that could arise in
0.6
Temperature anomaly (°C)
0.4
0.2
0
– 0.2
– 0.4
– 0.6
1860
1880
1900
1920
1940
1960
1980
2000
Figure 6.1 Global average near-surface temperatures, 1860–2000.
Source: Data from the Hadley Centre for Climate Prediction and Research, the
Meteorological Office, UK. See http://www.met-office.gov.uk/sec5/CR_div/
Tempertr/pics/land+sst_web.txt).
Climate governance in the GCC 121
4
the future include: water shortages, adverse impacts on agriculture, sealevel rise causing coastal erosion, and impacts on human health. Not
doing anything about greenhouse gas emissions could cost the world
economy over $300bn per year by 2050.5 The 1998 El Niño-related
weather disasters, for example, caused 23,000 deaths and $33bn in
damages.6
Greenhouse gas emissions and the impact of climate change can successfully be mitigated at relatively low costs. Technologies for mitigating
emissions have developed fast since the previous report in 1995, and
Working Group III suggests that global emissions could be reduced to
below 2000 levels by 2010–20 at relatively low cost. ‘Half of these
potential emission reductions may be achieved by 2020 with direct
benefits exceeding costs’, the report says. In conclusion, the report
maintains that ‘climate change “can be beaten” . . . but what is lacking
is the political will’.7 Key to the relatively low costs are the various
flexibilities build into the Kyoto Protocol, such as the basket of gases, the
inclusion of sinks and the possibility of making reductions elsewhere,
where costs are lowest. Economic models suggest that the costs could be
reduced by 80–90 per cent.8
Although sometimes known as ‘global warming’ there is more to the threat
of climate change than rising temperatures. The IPCC reviewed the potential
impacts of climate change; these included: sea-level rise, loss of biodiversity,
desertification, disappearance of glaciers, flooding and erosion, etc. Rapid
climate change, the possibility that there will be a sudden switch to a new
climate system rather than gradual warming, could further worsen the
situation.
Developing countries are likely to suffer in particular. Changes in the
hydrological cycle could be of particular concern in some regions where water
availability is already low, such as the Middle East, North and East Africa and
Central Asia. Although global agricultural production is expected to be
maintained, the tropical and subtropical regions, where most of the world’s
poor are already vulnerable to weather-related changes in agricultural output,
are most at risk of regional changes in crop yields and failure. Most developing
countries do not have the resources to adapt to these changes. The bare survival
of some developing countries in particular are threatened by sea-level rise as
a consequence of the global rise of temperature; these countries are the lowlying and island states – some islands’ highest points are less than a metre
above sea level and a few islands have already disappeared. Some severe
impacts on the developed economies are also possible, for example through
the shut-down of the Gulf Stream that warms Northwest Europe,9 but they are
in a much better position to adapt to this change.
122 Christiaan Vrolijk
6.00
Emissions (tonnes of carbon per capita)
USA
5.00
Canada, Australia, New Zealand
4.00
Russia
Japan
OECD Europe
Other EIT
3.00
2.00
Middle East
1.00
China
Latin America
Other Asia
Africa
India
0
0
1,000
2,000
3,000
4,000
5,000
6,000
Population (million)
Figure 6.2 Global per capita CO2 emissions and population, 1998.
Source: Data from CO2 Emissions from Fossil Fuel Combustion, Paris: OECD/IEA,
2000.
The main cause of anthropogenic climate change is the emission of CO2
from the use of fossil fuels. Most of the use of these fuels takes place in the
developed countries, members of the OECD or the former Soviet Union
countries. With only 20 per cent of global population, these developed
economies produce 80 per cent of global wealth, but they also produce 60 per
cent of carbon emissions. On average, a person from a developed country
emits six times the amount of CO2 than an inhabitant of a Third World country;
an American emits twenty-three times the amount that an Indian does.
International response to climate change
Scientific developments and the potentially serious economic and political
impacts stimulated action to mitigate climate change by national governments
in the 1980s; in the early 1990s governments started international negotiations.
In February 1991 the negotiations for a global agreement on climate change
began. The UN Framework Convention on Climate Change (FCCC) emerged
and was signed at the Earth Summit in Rio de Janeiro, Brazil, in June 1992. This
Convention was the first co-ordinated step towards a global response to the
threat of climate change. Under the Convention the various parties committed
themselves to stabilise greenhouse gas concentrations ‘at a level that would
prevent dangerous anthropogenic interference with the climate system’.10
Climate governance in the GCC 123
The Convention established differentiated commitments, with the industrialised countries taking most responsibility in fighting the causes of climate
change. The headline commitment of the Convention for the industrialised
countries (the Annex I Parties) was to return greenhouse gas emissions to
1990 levels, and to show a reversal in the trend of growing emissions before
the year 2000. However, developing countries are also committed under the
Convention to promote sustainable development and implement measures to
mitigate and adapt to climate change (with financial resources and technology
transfer from the Annex I Parties).
These commitments were soon seen to be insufficient and the first
Conference of Parties (COP-1), in 1995 in Berlin, agreed to begin ‘a process
to enable it to take appropriate action for the period beyond 2000, including
the strengthening of the commitments of Annex I Parties’.11 The negotiating
process based upon this ‘Berlin Mandate’ culminated at the third Conference
of Parties (COP-3) in Kyoto, Japan, in December 1997. The Kyoto Protocol
sets out renewed, legally binding emission reduction commitments for the
industrialised countries in the period 2008 to 2012. Overall these commitments amount to a 5.2 per cent reduction from 1990 levels for a basket of
greenhouse gases, including carbon dioxide (CO2), methane (CH4), nitrous
oxide (N2O), some industrial gases (HFCs, PFCs, SF6) and emissions and
removals from land-use change and forestry (LUCF or ‘sinks’).12
In Kyoto, only a framework for these commitments could be agreed upon.
The Kyoto Protocol, therefore, does not contain the necessary details of, for
example, the various mechanisms for international transfers of emission
allowances,13 nor categories of sinks. The negotiations since Kyoto have
focused on filling these gaps. Buenos Aires (COP-4) set out the timetable for
the negotiations, whilst Bonn (COP-5) showed some progress, but was mainly
a working session. The sixth Conference of Parties (COP-6) was to be the
‘crunch’ meeting – the deadline of the Buenos Aires Plan of Action – where
all was to be decided.
More than 7,000 participants from nearly 200 countries descended on The
Hague in November 2000. Ever since the agreement in 1997 to reduce the
emissions of the developed countries, negotiators had been working on
the details of this protocol. Many decisions were needed in order to make a
clear definition of how the Parties (countries) were to reach their targets.
Expectations for The Hague were high. An agreement would pave the way
for establishing the protocol by the time of Rio+10 in 2002, the target set by
the EU, Japan and Russia. Failure could jeopardise the whole process of
climate negotiations. Nonetheless, COP-6 failed!14
International negotiations were scheduled to resume in Bonn (16–27 July
2001), with the second part of COP-6.15 However, prospects seemed bleak
initially under the new US Administration of President George W. Bush.
124 Christiaan Vrolijk
Then the US announced, at a G8 meeting, to regulate carbon dioxide
emissions from power plants, showing willingness to reach an agreement.
Only ten days later, President Bush retracted this promise under pressure
from industry, virtually sinking any hope for the resumed COP-6.
GCC responses in the negotiations
Representing most of the world’s population, and most of the world’s
countries (more than 120), the Group of 77 (G77) – quite often working as
G77 and China – is the main developing country negotiating group in many
different international negotiations. The group includes countries with very
different objectives, including OPEC, with its oil export interests, and AOSIS,
the Alliance of Small Island States that are being threatened in their existence
by warming and rising sea levels. The large size and representation give the
group a strong negotiating position. However, the diversity in objectives, and
frequently a lack of institutional capacity, limit this negotiating power.
The various groups that make up the G77 (and China) therefore sometimes
use subgroups of like-minded countries in the negotiations (such as the oil
producing countries, AOSIS, the African group) in order to advocate specific
points in their interest. Figure 6.3 shows that the GCC countries are in a very
different position than the other developing countries. Their emissions are
CO2 emissions from energy use
Per capita emissions (tC/cap)
12.5
country emissions
10.0
average developing country emissions
average Annex I emissions
7.5
5.0
2.5
India
Africa
China
Oman
EU
Japan
Saudi Arabia
Australia
US
Kuwait
UAE
Bahrain
Qatar
0
Figure 6.3 GCC emissions compared with other regions.
Source: Data from CO2 Emissions from Fossil Fuel Combustion, Paris: OECD/IEA,
2000.
Climate governance in the GCC 125
actually among the highest in the world, far above the average of even Annex
I, while the emissions of the Africa group and India are extremely low.
In the negotiations all countries will serve their own ends and strive
to minimise the negative impacts on their own people. The oil exporting
countries fear a large reduction in the use of fossil fuel and therefore of
income. The strong dependence of the GCC on their oil export earnings has
made them weary of any limitation of fossil fuel use, or any agreement that
could influence their exports. The oil exporting Gulf states have therefore
used various strategies in the climate negotiations since Rio:
1
2
3
4
5
Denial of the scientific evidence.
Delay and complication of the negotiations.
Shifting the focus away from fossil fuels.
Not accepting the proposals for reasons of unfairness.
Demanding compensation for damage.
These tactics were designed to hold up the negotiations and stop global
agreement on action that could influence the demand for fossil fuels. The
heavy economic dependence makes the GCC’s reaction understandable to
some degree, but hardly justifiable.
Denial of the scientific evidence
The first tactic used by the GCC was a denial of the existence of
climate change. In the late 1980s and beginning of the 1990s the science
of climate change was rather uncertain. The establishment in 1988 of
the Intergovernmental Panel on Climate Change, an organisation of hundreds
of scientists from around the world, was meant to bring a consensus in
the science. Most scientists agree that the climate is changing, and that
human emissions are one of the causes; however, some disputes still exist
over the timescale, degree of change and what the regional impacts are
going to be. Most of the controversy is about the attribution of the cause of
the change. The Second Assessment Report concluded that ‘the balance
of evidence suggests a discernible human influence on global climate’, 16
and the Third Report uses stronger language. The Framework Convention of
1992 recognises the existence of scientific uncertainty, but dismisses this
as a reason not to act. While the GCC also agreed the Convention,17 it only
stopped denying the existence of climate change in 1996, still stressing the
uncertainty of the science and showing a reluctance to take costly action.
The GCC now stresses the adverse impacts from climate change and the need
for mitigation efforts, and would like to discuss compensation for these
economic damages.
126 Christiaan Vrolijk
The discussions to accept the Third Assessment Report of the IPCC again
provided a forum where the Saudis tried to weaken the scientific text on the
impacts of climate change.18 By trying to reduce the seriousness of the impacts
from climate change, they were aiming to reduce the urgency of the negotiations and postpone action.
Delay and complication of the negotiations
Throughout the negotiations of the Kyoto Protocol, the oil exporting
countries, mostly led by Saudi Arabia, were delaying the proceedings
by repeating the same statements, commenting on non-issues, etc. An
(admittedly green) newsletter on the negotiations at the Fifth Conference of
Parties reported frustration at the negotiation on compliance:
After making considerable progress, a draft negotiating text was being
prepared. A few days into the proceedings, however, the Saudis suddenly
objected to the fact that the documents were in English – an astonishing
claim to those who have experienced their many lengthy intervention in
that language. Then, on Monday night, when they were unable to delay
the actual discussion of the text any further, they objected to each and
every paragraph, and every word, dragging the process out until the
co-chair threw the text over his shoulder in exasperation. The piece de
resistance came when they objected to allowing the word ‘negotiation’
into the text – as if the delegates were here for any other reason.19
The same report continues with other examples of delaying behaviour: the
Saudis objected to draft texts because they had not attended the discussion
groups considering them; OPEC countries also frequently refused progress
on one issue until decisions were made on other specific points in their
interest. This tactic lead to great complexity in the negotiations. In the end,
this entangled web of interrelated discussions made it impossible to resolve
any single issue until the final crunch at COP-6. But by then the agenda had
become too large to resolve! The OPEC-forced complexity was one of the
important factors finally sinking the negotiations in The Hague.20
Shifting the focus away from fossil fuels
The main anthropogenic cause of climate change is the emission of carbon
dioxide from the use of fossil fuels. CO2 from fossil fuels takes account of 70
to 80 per cent of the total emissions of greenhouse gases. A protocol limiting
greenhouse gas emissions could therefore easily be designed as a limitation
on the use of fossil fuels. This, however, is against the interest of the GCC,
Climate governance in the GCC 127
who are strongly dependent on exports of oil. Other parties were reluctant to
limit the use of energy, which (partly) drives economic growth. The GCC,
along with others, has successfully argued that the limitations should include
the other greenhouse gases and sinks, each for a specific reason.21 Indeed,
the Kyoto Protocol includes the widest possible basket of gases, making
reductions possible in the most efficient manner. However, the environmental
effectiveness of including additional land-use changes and forestry activities
still has to be determined.
Not accepting the proposals for reasons of unfairness
If developing country per capita emissions were to keep on growing towards
the levels in the OECD they would totally eclipse industrialised country
emissions. However, there was a general agreement that developed countries
should take the lead in combating climate change, but there were some
important disputes as to why. The developing countries stressed the historic
‘debt’ resulting from the much higher emissions of industrialised countries
in the past, which have caused the problem. Developed countries argued that
current generations were not to blame for historic emissions and that they
would take the lead because of their present (financial) capacity to do so.
This dispute has been at the centre of many debates. The developing
countries perceive the industrialised countries as being the ones that have
caused the problem; they are therefore obliged to solve the problem. This
should leave some opportunity for the developing countries to grow, and any
action that they might have to take should be financed by the industrialised
countries.
With the Framework Convention, and again with the Kyoto Protocol, the
industrialised countries have accepted the responsibility of taking action on
climate change. The Protocol has established emission reduction targets
for these countries, while they are also responsible for any cost the developing countries might incur from mitigation. On the other hand, developing
countries do have a responsibility to take the climate and sustainability into
account. But the reason for determining that the industrialised countries take
the lead is the lack of institutional and financial capacity in the rest of the
world.
Nonetheless, some OECD countries in particular have continuously argued
for a further expansion of commitments, including emission targets, for the
developing countries. The reason for this demand is that no one single group
of countries can ‘save the climate’, it has to be a world-wide effort. In the US,
for example, developing country participation has become crucial for further
implementation of action to combat climate change.
128 Christiaan Vrolijk
Demanding compensation for damage
From 1996 onwards, the GCC has used the argument of climate science
less often. Instead they have stressed the economic damage done by climate
change mitigation, and have requested compensation for any losses. The
problem is yours they argue, and all the costs should be yours. The strong
dependency on oil revenues, which could be slashed by obligatory reductions
of fossil fuel use, makes this call for compensation understandable. At COP6, for example, Saudi Arabia claimed it would lose $25bn in oil revenues by
2010.
However, compensation is far from the economic and political reality.
Quite apart from the impossibility of determining the real economic damage
from the Kyoto Protocol action being taken by the developed countries, other
factors are not in OPECs favour. The oil crises of the 1970s – and the pricehikes in 1999–2000 – have raised oil prices above free market price and are
damaging industrialised and developing countries alike, purely because of the
intervention of a few (OPEC) countries. The GCC countries are relatively rich
and produce high levels of emissions, while some other developing countries
are in dire straits and would not receive any economic compensation. The
impact on the GCC would only be significant if the emission reduction targets
are tough to meet, and therefore expensive, leaving insufficient funds for
compensation. At the time of COP-6, floods were crippling the UK, and the
year 2000 had already seen many costly climate-related disasters throughout
the world. So, economic compensation for lost revenues is unacceptable for
both the industrialised countries and the other developing countries.
The next section will deal in more detail with the implications the Kyoto
Protocol, the targets, costs, and emissions trading. Then it will analyse
the trade impacts, economic damage and possible compensation for GCC
countries.
The economics of the Kyoto Protocol
The Framework Convention agreed on a flat target to stabilise emissions in
all countries of Annex I at their 1990 levels. However, the situation facing
the negotiators in Kyoto was very different in terms of the economic and
emission trends already observed during the 1990s. Most OECD countries
were far from reaching their Rio target for the stabilisation of emissions;
indeed, emissions had risen sharply since 1990. Some countries in Europe
had stable or declining emissions (but unrelated to climate policies). The
emissions from countries in Central and Eastern Europe and the former Soviet
Union had declined sharply to levels of between 10 and 50 per cent below
those of 1990, due to their economic transition. Thanks to this massive
Climate governance in the GCC 129
decline, emissions in the developed countries overall had fallen to 5 per cent
below 1990 levels. In this ‘mess’, differentiated targets were agreed, not on
the basis of any of the formulae for differentiation, but largely on raw political
considerations.22 The targets for the three main groups, the EU, the United
States and Japan, were based on negotiating strength and bargaining and
ended up very close indeed. Within the European Union, the targets were
redistributed according to an internal burden-sharing agreement which allows
large increases of emissions in some of the poorer ‘cohesion countries’ to be
offset by steep targets for some of the larger, richer and higher emitting
countries in the EU.
The Kyoto Protocol of December 1997 sets out legally binding emission
reduction targets for the industrialised countries, listed in Annex B of the
Protocol. Overall, the targets add up to a 5.2 per cent reduction of greenhouse
gas emissions from the base year 1990. The targets for the main countries
are similar, ranging from a 6 to 8 per cent reduction. Other countries have
called on special circumstances and received more lenient targets, up to an
allowed 10 per cent increase for Iceland, for example. Table 6.1 indicates the
main targets.
The expected costs of the Protocol’s emission reduction targets vary
widely. Some studies argue that large inefficiencies exist and that the costs
will be minimal. Other studies see the targets as a direct limit on economic
growth, which they see as directly linked to energy use. Grubb et al. listed a
wide range of studies projecting costs of between 0.2 to 2.0 per cent of GDP
in the year 2010, or 0.3 to 1.4 per cent, neglecting the outlying models.23
They estimated the costs using this range in the order of $85bn per year
(0.5 per cent of GDP), close to the estimate of the Massachusetts Institute
of Technology (MIT) of $120bn.24 These costs will be borne by the OECD
countries, while the costs for the former communist countries is low or
even zero.
The domestic implementation of these targets could lead to a substantial
reduction in the use of some fossil fuels. An estimate by MIT suggests that
the largest impact will be on coal, with a demand reduction of around 50 per
Table 6.1 Emission reduction commitments for some Annex B countries
Country/region
Target (% from base year)
EU
US
Japan
Central and Eastern European countries
Russia and Ukraine
Other OECD countries
–8
–7
–6
–5 to –8
0
+10 to –8
130 Christiaan Vrolijk
cent.25 Both oil and gas demand will be affected much less, estimated to be
below 5 per cent. Globally, this would still mean a substantial increase from
the demand levels of the base year 1990. A new study released by the Oxford
Institute of Energy Studies, looking primarily at the impact on fossil fuels,
also estimates that demand will decrease (less for coal, more for oil and gas).
As a result, the price will be reduced and total export earnings could collapse.
However, the Kyoto Protocol introduced various flexible ways of meeting
the emission reduction targets. First, the targets are defined in a basket of
gases and land-use emissions. Countries could therefore direct their efforts
towards the emissions from agriculture and industry, instead of energy, and
start reforestation programmes. Second, the Protocol also allows various ways
of trading emission credits. MIT estimated the cost reductions of emissions
trading within Annex B to be over 50 per cent, while world-wide trading
could deliver 90 per cent cost reductions.26 All the flexibilities of the Protocol
are designed to allow countries to mitigate emissions in the cheapest way
possible. The economic transition in Eastern Europe opens up large quantities
of cheap reductions for Western investors. On top of that, many believe that
emissions trading will encourage innovation, making reductions in the long
term cheaper.
The impact on the fuels
OPEC countries are particularly concerned about the impact of the Kyoto
Protocol on the sales of their oil. The rather moderate-looking targets from
1990 levels translate into large reductions for projected levels in 2010.
Whereas Kyoto adds up to only 5 per cent from the base year, the target is
nearly 20 per cent below usual levels for Annex B and 30 per cent or more
for some specific countries.27 If these required reductions were translated
directly into a 20 per cent reduction in oil use and oil exports for the Middle
East, the impact could be quite severe. But even then, this could still mean
an overall growth of oil exports from current levels due to strong growth in
the developing countries. Also, it is very unlikely that oil demand will decline
by as much as emissions.
For the same amount of energy, the use of coal emits about 2 tonnes of
greenhouse gases compared to 1 tonnes from natural gas, while oil emits
about 1.5 tonnes. It is therefore likely that the reduction policies will
target the greatest emitting energy source, coal. Coal is mainly used in the
industrial and power sectors where alternative fuels are easy to find. Oil,
however, is used mainly in transport, where there are very few alternatives
and the ‘near term prospect for oil demand reductions from transport is
unlikely’.28 Therefore, it seems very unlikely that oil demand will be greatly
affected.
Climate governance in the GCC 131
Further, the Middle East exports of oil are increasingly going to non-Annex
B countries, countries that do not have emission reduction commitments
under the Kyoto Protocol. In 1990 70 per cent of exports went to Annex B,
but in 1998 this was only 60 per cent and this share will fall further in the years
to come. Export growth has mainly taken place to the non-Annex B countries,
up by more than 60 per cent from 1990. This means that most of the future
growth in export earnings will also come from the unrestricted countries
outside Annex B.
As mentioned above, implementation of the Kyoto Protocol targets domestically could lead to a dramatic drop in coal demand of over 50 per cent from
the projected level in the United States. However, when emissions trading
is allowed, as it is under the Kyoto Protocol, demand will only be reduced
by about 20 per cent, compared to the projections. For oil, these demand
reductions are much smaller: 3.5 and 0.2 per cent respectively,29 hardly
discernible compared to the projected growth and easily within the margin
of error of the projections.
Indeed, an IEA study argues that OPEC’s estimate (and that of other models)
of oil revenue losses are ‘likely to substantially overstate overall costs’.30 This
is mainly due to the incomplete modelling of the Kyoto Protocol flexibilities.
A multi-gas analysis has shown that much of the reduction effort will concern
other greenhouse gases, without affecting fossil fuel demand at all.31 The study
by Grubb et al.32 suggests that the effect of the flexibilities, multiple gases and
trading will be additional, leading to a very substantial reduction in the impact
on the fossil fuel markets. The Oxford study33 similarly used a multiple gas
analysis with trading, where oil demand was hardly influenced. However, the
authors concluded that even a slight reduction in demand would influence
the price (in a competitive market model), stopping unconventional oil from
gaining market share, but that the revenues of conventional oil producers were
only marginally effected. The oil price has recently been very independent of
demand, but instead completely dependent on the supply. In 1999–2000 OPEC
has again successfully introduced quotas to tighten the market and support the
price. The market is unlikely to change in this respect and emission reductions
will therefore only have a negligible effect on the (conventional) oil revenues.
Even though the GCC countries have a genuine reason for concern about
their economic future, this is not to blame international climate change policy.
The Middle East economies are very heavily based on one export product,
which makes them very vulnerable to any instability. This is a structural
problem for these economies, and should be of concern to their governments;
it is not a problem arising out of emission reductions. It is possible that
demand for fossil fuels will decrease, delaying the consumption of the present
finite reserves. It could lead to lower prices, but the scale of the impact is
impossible to measure. The Kyoto Protocol seems to limit the consumption
132 Christiaan Vrolijk
of oil only marginally, effecting the price hardly at all. Daily price swings in
the current oil economy are possibly larger than the (sustained?) impact of
the Protocol’s reductions. However, the OPEC supply quota, and in particular
the supply limitations of 1973, 1979 and again in 2000, have a much larger
impact on the price of fuel than the Kyoto Protocol.
OPEC argues that with Kyoto the international community has made a
decision that will reduce export earnings for which they should compensate the oil exporters. However, any compensation is quite impossible: what
would the price and demand have been without Kyoto? And even if Kyoto
actually reduces demand, it is merely delaying the sale of the oil. Furthermore,
the importers argue, can oil supply reductions, doubling the oil price and
crippling the economies of some oil importing developing countries, continue
without compensation?34 Oil is a commodity open to price changes on the
market, going up and down as a result of supply restrictions or demand
reduction.
Recent developments in the negotiations
The negotiations of the Kyoto Protocol were expected to culminate at
the Sixth Conference of Parties (COP-6) in The Hague, The Netherlands,
13–25 November 2000. In the run up to this crucial meeting, a workshop was
organised on the adverse effects of climate change and implementation
measures in March 2000. This workshop was attended by about eighty-five
experts from governments, NGOs and others. The participants discussed
various methodological approaches and actions needed under the FCCC and
Protocol. Both in this workshop and the one on best practices in policies
and measures, 11–13 April 2000, the GCC stressed the same ideas.
Some presentations were made at the workshop summarising recent studies
on the impacts of the Kyoto Protocol. In general the economic impacts of
response measures were expected to be negative for both the OECD and oil
exporting countries, while other countries could experience positive impacts.
The distribution of revenue losses, however, would vary according to the fuel
and region. Saudi Arabia jumped at the opportunity, and asked for compensation, not immediately, but after the extent of the negative impacts has been
proven. The reaction from Annex B was not entirely favourable. In the
discussion, Qatar noted that oil revenues should be invested strategically to
ensure future welfare, because oil is a commodity that will be depleted.35
The GCC countries also provided some input on policies for Annex B
Parties at these recent workshops. They advocated the reduction of market
imperfections in all greenhouse gas emitting sectors, including the energy
sectors. According to the Saudi participants, Annex B policies should include
various measures36
Climate governance in the GCC 133
The first set of measures are very sensible, and will lead to a reduced impact
on the developing countries and bring advantages for Annex B as well:
1
2
3
4
Restructuring the tax system to reflect the carbon content.
Encouraging CO2 sequestration.
Include all greenhouse gases in the abatement policies.
Transfer technology for CO2 storage, reduction of gas flaring and venting,
and energy efficiency.
The second set of measures is simply aimed at increasing oil sales from
OPEC, and is completely unrelated to climate change or the impact of
emission reduction strategies:
5
6
7
Discouraging oil production in Annex B countries.
Discouraging the use of nuclear energy.
Removing barriers for the use of oil in the electricity sector.
Two further measures were also proposed, but these are not likely to
happen:
8
9
Assist economic diversification of oil exporters.
Establish funds for compensation.
Negotiations at the last meeting before COP-6, in Lyon, took place
while fuel protests crippled the whole of Europe. Oil production reductions sanctioned by OPEC had forced prices up to record levels. European
consumers, while used to relatively high energy prices, protested and
demanded price reductions (through a reduction in petrol tax). In many
countries they succeeded, which does not bode well for the implementation
of carbon taxes. However, while the world economy suffered from oil prices
double that of previous levels, OPEC once again demanded compensation for
losses of oil revenues.
The crucial meeting of COP-6 finally broke down under the weight of the
agenda of interrelated issues built up during the preceding three years. OPEC
countries were key in stifling previous rounds of negotiations with demands
for linking issues that could (and should) have been negotiated separately.
Conclusions
Climate change is a serious problem that could have major global effects.
The international community has responded and negotiated the Framework
Convention on Climate Change in 1992. The Kyoto Protocol, of December
134 Christiaan Vrolijk
1997, is the follow-up to the Convention and sets legally binding reduction
targets for the industrialised countries.
Some of the GCC countries are themselves in a vulnerable position
regarding climate change, including the possibilities of drought and sea-level
rise. They need an effective climate mitigation policy to minimise these
adverse impacts.
Apart from the direct impacts of climate change, the oil exporting countries
have another concern: the implementation of the Kyoto Protocol could lead
to a weakening of oil demand. The belief that the response to climate change
could lead to a collapse of the oil market has driven the GCC in its particular
negotiating strategy. This strategy has evolved over time and is still evolving.
Strategies have included: (1) denial of the scientific evidence, (2) delaying and
complicating the negotiations, (3) shifting the focus away from fossil fuels
or energy to other gases and sinks, (4) not accepting the proposals and (5)
demanding compensation.
The GCC’s strategies have been partially successful. The biggest success
is probably the inclusion of the other greenhouse gases and sinks. They have
also included articles on the need to minimise the negative impacts of the
climate policies on the developing countries, including the oil exporters.
More cynically, OPEC has succeeded in stopping the negotiations reaching
agreement in The Hague, and therefore of any serious action taking place.
However, the blame of failure rests more with the Annex B Parties, who took
on commitments in Kyoto, but who are reluctant to implement emission
reduction.
The Kyoto Protocol has introduced many forms of flexibility for the Annex
B countries to reach their targets. This flexibility has greatly reduced overall
costs and impacts on the energy markets. It seems likely that coal mining
in particular will be affected. The demand for oil, so crucial for the GCC
countries’ economies, is likely to be affected very little, because demand
(mostly in the transport sector) is inelastic. Rather, the oil exporting countries
might play a substantial role in the emissions market through Clean
Development Mechanism (CDM) projects in their production facilities, or
further development of CO2 storage technologies.
The GCC should develop a strategy for economic diversification away
from oil exports. Part of the diversification could be towards energy intensive
industry, emission reduction projects, or less carbon intense fuels (natural
gas, or renewables). The GCC should take a proactive role in the negotiations
and implementation of the Protocol in its own best interest, by stressing the
gains from increased flexibility. All the Kyoto mechanisms, other gases
and sinks, and the removal of subsidies for fossil fuels (in particular coal), are
cost-effective emission reduction policy measures that reduce the impact on
oil demand.
Climate governance in the GCC 135
Notes
1 Peter Kassler (ed.) Environmental Issues for the Gulf: Oil, Water and Sustainable
Development (London: Royal Institute of International Affairs, 1999).
2 J. T. Houghton et al. (eds.) Climate Change 1995: The Science of Climate
Change (Cambridge: Cambridge University Press, 1996), p. 4 (Summary for
policy makers), or p. 439, ch. 8. For a full discussion of the outcome of the
Second Assessment Report, see Duncan Brack and Michael Grubb, Climate
Change: A Summary of the Second Assessment Report of the IPCC, RIIA
Briefing Paper No. 32, July 1996.
3 See http://www.met-office.gov.uk/sec5/CR_div/Tempertr/pics/land+sst_web.txt.
4 See the website of the IPCC for press releases and the policymakers’
summaries: http://www.ipcc.ch.
5 UNEP study by reinsurance company Munich Re, reported in Global
Environmental Change Report, XIII, no. 4 (23 February 2001).
6 Science, 19 February 1999, p. 1108.
7 BBC News Online, Monday, 5 March 2001.
8 For a full discussion of the economics of the Kyoto mechanisms, and an analysis
of various emissions trading studies, see Michael Grubb with Christiaan Vrolijk
and Duncan Brack, The Kyoto Protocol: A Guide and Assessment (London:
RIIA/Earthscan, 1999). For an in-depth analysis of the impacts of the inclusion
of various additional flexibilities, see Christiaan Vrolijk and Michael Grubb,
Quantifying Kyoto: How Will COP-6 Decisions Affect the Market? RIIA Workshop Report, 30–31 August 2000, available at http://www.riia.org/Research/
eep/quantifying.html.
9 Presented by the Potsdam Institute in a side meeting at COP-4 in Buenos Aires.
10 FCCC, Article 2.
11 Decision 1/CP.1, 7 April 1995, the ‘Berlin Mandate’.
12 Grubb et al., The Kyoto Protocol, op. cit.
13 The Kyoto Protocol established three mechanisms for international transfers,
emissions trading, joint implementation, and the clean development mechanism.
All these mechanisms are described in the Protocol text at a very basic level only.
These mechanisms are introduced for economic efficiency, they make it possible
to invest in emission reductions where it is cheapest to do so, anywhere in the
world, and claim the credits of the reduction for the investor.
14 For much more on the COP-6 negotiations, and the way forward, see
International Affairs 77 (2) (April 2001).
15 The president of the COP, Dutch environment minister Jan Pronk, was requested
by the new US Administration to postpone the combined resumed COP-6
and SB-14 meetings. On 28 February 2001 these new dates were announced to
replace the planned end of May meeting.
16 J. T. Houghton et al. (eds) Climate Change 1995.
17 All six countries of the GCC have ratified the FCCC; Bahrain, Kuwait and
Saudi Arabia in December 1994, Oman and the UAE in 1995, and Qatar in
1996.
18 ‘Saudis try to Weaken Climate Change Talks’, United Press International,
17 February 2001.
19 ECO, CII, Issue No. 7, 3 November 1999.
20 The press focused mainly on the high-profile internal EU and EU–US disputes.
The UK deputy prime minister, John Prescott, stormed out of the building –
‘I’m gutted’ – blaming French environment minister, Dominique Voynet,
136 Christiaan Vrolijk
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
holding the presidency for the EU in The Hague, for not understanding the deal
through the press. After the COP was suspended, the US said it had done all
to rescue the deal, but the EU had thrown it away. The EU blamed the US (and
other Annex B countries) that they had not taken Kyoto seriously, etc. The final
bargaining on the size of sinks between the EU and the other Annex B countries
did not succeed for various reasons. However, this was not the only point of
dispute, nor would it necessarily have been agreed by all the developing country
Parties who were not in these closed-door negotiations.
These reasons include genuine concerns about the effectiveness of the agreement when not all gases and sources are included; fear of limiting economic
growth by limiting energy use; and domestic opportunities of reducing the
emissions in the additional gases, sources or sinks.
Sebastian Oberthür and Hermann E. Ott, The Kyoto Protocol: International
Climate Policy for the 21st Century (Berlin: Springer-Verlag, 1999).
Grubb et al., The Kyoto Protocol, op. cit.
A. Denny Ellerman, Henry D. Jacoby and Annelene Decaux, ‘The effects on
developing countries of the Kyoto Protocol and CO2 emissions trading’, MIT
Joint Program on the Science and Policy of Global Change Report Series, No.
41, November 1998.
Ibid.
Ibid.
World Energy Outlook (Paris: International Energy Agency [IEA], 1998).
Jonathan Pershing, Fossil Fuel Implications of Climate Change Mitigation
Responses (Paris: International Energy Agency [IEA], 1999).
Denny Ellerman et al. op. cit.
Jonathan Pershing, op. cit.
Grubb et al, The Kyoto Protocol, op. cit.; and John Reilly, Monika Mayer and
Jochen Harnisch, ‘Multiple gas control under the Kyoto agreement’, MIT Joint
Program on the Science and Policy of Global Change Report Series, No. 58,
March 2000.
Grubb et al., The Kyoto Protocol, op. cit.
Ulrich Bartsch and Benito Müller, Fossil Fuels in a Changing Climate (Oxford:
Oxford University Press/OIES, 2000).
In a recent UNFCCC workshop, Tuvalu questioned OPEC’s approach to the
perceived market imperfections in Annex B, limiting oil consumption, and
asked whether the recent supply restrictions could also be seen as a market
imperfection. Taken from ‘Summary of the workshop on best practices in
policies and measures, 11–13 April 2000’, Earth Negotiations Bulletin, 12, no.
126, IISD (15 April 2000).
‘Summary of workshops on Article 4.8 and 4.9 of the UNFCCC: adverse effects
of climate change and the impact of implementation of response measures, 9–11
and 13–15 March 2000’, Earth Negotiations Bulletin, 12, no. 125, IISD (17
March 2000).
ENB 12:125, 17 March 2000, and ENB 12:126, 15 April 2000, summaries of
FCCC workshops, op. cit.
Index
Abdel-Amir al-Jamri, Sheikh 33, 34,
112
Abdel Aziz bin Abdel-Rahman (Ibn
Saud) 37
Abdel-Aziz Mohammed 107
Abdel-Rahman al-Rashed 114
Abdullah, Crown Prince 37, 38, 41, 42,
74, 92, 114
Abdullah bin Mohammed al-Thani 49
Abdullah Bin-Khalid Al Khalifah,
Sheikh 35
Abdullah bin Zayed, Sheikh 108, 109
Abu Zuluf family 106
Afghanistan, Soviet invasion 30
Ahmad Jarallah 110
Ahmed bin Ali al-Thani 49
Akhbar al-Khalij 112
Al-Anbaa 110
Al Aqsa Company for Trade, Transport
and Tourism 55
Al-Ayyam 112
Al-Hayat 106, 108, 113, 114, 115
Al-Khaleej 109
Al-Madina 114
Al-Nadwah 114
Al-Qabas 110, 111
Al-Quds 106
Al-Quds al-Arabi 106
Al-Rai al-Aam 111
Al-Raya 108
Al-Siyassa 110, 111
Al-Watan 110, 111, 112
Al-Yamamah programme 99
Al-Yawm 114
Ali Al Khalifa, Sheikh 110
Ali Saleh 112
Alliance of Small Island States
(AOSIS) 124
Amnesty International 3, 7, 11, 35
Arab League 46
ARAMCO 94
Asharq al-Awsat 106, 113, 114, 115
Bahrain 30, 31, 32–7
demography 36–7
foreign policy 35–6
the West 36
Kingdom of Bahrain 35
media 111–12
political context 32–3
political opposition 34
political participation 72–4
political reform 34
relations with Qatar 51
Bahrain Freedom Movement (BFM)
33, 34, 73
Bani Yas 52
Basic Law of Government 40
Beblawi, Hazem 64
Bin Laden, Osama 74, 79
Boeing 99
BP Amoco 95
British Aerospace 94
Al-Bu Said family 46, 47
build–own–operate (BOO) projects 92
Bush, President George W. 123–4
Camp David accord 48
Cardoso, Fernando Henrique 17
Carter, President Jimmy 63
138 Index
Chaudhry 64
Chevron 95
Chinese Petroleum Corporation 95
climate governance 119–34
climate change 119–22
international response to 122–4
GCC responses in negotiations
124–8
compensation for damage 128
delay and complication of the
negotiations 126
denial of scientific evidence
125–6
fossil fuels 126–7
opposition to proposals 127
recent developments 132–3
see also Kyoto Protocol
Cold War 5, 6, 61, 67
Commercial Investment Law (Saudi
Arabia) 95
Committee to Defend Legitimate
Rights (CDLR) 74, 79
Conference of Parties 123–4, 128,
132–3
Conoco 95
Consultative Council (Majlis al-Shura)
40
crisis of legitimacy 12–13
Darwish, Lujaina Haider 72
democratisation debate, oil monarchies
and 62–6
dependency theory 17
Dubai Civil Aviation Authority 55
Earth Summit (Rio, 1992) 122
Egyptian Radio and Television Union
105
Egyptian Space Channel 105
El Niño 121
Emiratisation 55
ENI 95
Esposito, John L. 22
Euro-Mediterranean Partnership 102
European Union 10, 100, 102, 129
Exxon 95
Fahd bin Abdel-Aziz Al-Saud, King
37, 38, 40, 67, 74, 94
Faisal, Crown Prince 40
Al-Faqih, Osama Bin Jafar Bin Ibrahim
98
Federal National Council (FNC) 53
fiscal crisis of the state 79–80
Four Theories of the Press 103
Framework Convention on Climate
Change (1992) (FCCC) (UN)
122–3, 125, 127, 133
Frank, Andre Gunder 17
freedom of expression 23
Fukuyama, Francis 5
Gause, F. Gregory 74, 80
General Agreement on Tariffs and
Trade (GATT) 98
General Electric 99
global warming 121
globalisation 18–20
good governance
application (1989–2001) 5–13
assessing progress 6–8
definition 1–4
end of history 4–6
forces driving 8–13
genesis 4–6
historical context 4–16
responses of state actors 8–13
theoretic context 16–24
Greenpeace 7, 11
Grouping of the ‘Ulama’ 39
Gulf Co-operation Council
(1989–2001) 14–15, 113
climate governance 119–34
governance 14–15
press–government relations
102–15
state of 29–56
Gulf News 108, 109
Gulf War 41, 93, 110
Halliday, Fred 22, 63, 77
Arabia Without Sultans 77
Hamad, Crown Prince Sheikh 33, 34,
49, 50, 72
Hamad Abdel-Aziz al-Kuwari 107
Hamid al-Ali 111
Hamad bin Isa Al-Khalifa, Sheikh 33,
35, 112
Hamad bin Jassem bin Jabr Al Thani,
Sheikh 108
Index 139
Hamad bin Khalifa Al Thani, Sheikh
36, 70, 106
Hardy, Roger 61
Hashem Mohammed al-Shakhs 39
Henderson, Ian 33
Herman, E. 104
human rights 7, 9, 10
Human Rights Watch 3, 11
Huntington, Samuel 5
Hussein, Saddam 41, 45, 55, 66
Ibn Saud 37
Ibrahim al-Assaf 91
Idemitsu Kosan 95
Imamate Rebellion 46
IMF 7, 8, 14, 43, 52, 85, 86, 94, 110
Intergovernmental Panel on Climate
Change (IPCC) 119, 120, 121,
125
international aid donors 8–9
International Court of Justice (ICJ) 35
international NGOs 11
international trade 10
Iran
relations with Saudi Arabia 41
Iran–Iraq War 54, 60, 61
Iraq
invasion of Kuwait 41, 45, 62, 105,
106
relations with Saudi Arabia 41
relations with United Arab Emirates
(UAE) 55
Isa bin Salman Al Khalifa, Sheikh 32,
33, 111, 112
Islam 20–4
Islamic Constitutional Movement 44
Islamic extremism 15, 23–4
Islamic National Alliance 44
Islamic Popular Alliance 44
Issa, Emir 72
Al-Jaber family 43
Jaber al-Ahmed al-Jaber al-Sabah,
Sheikh 43, 44, 69, 70
Al-Jazeera 108
jihad armed movement 74
Keane, John 103
Khaleej Times 108
Al-Khalifa family 32
Khalifa, Sheikh 32, 49, 50, 70, 72, 77
Khalifa bin Hamad Al-Thani 36
Khatami, Mohammed 41, 68
Khomeini 41, 67
Kuwait 30, 43–5
demography 45
foreign relations 45
Iraqi invasion of 41, 45, 62, 105,
106
media 110–11
political context 43–4
political opposition 44
political participation 69–70
political reform 44–5
Kuwait crisis (1990) 66, 74
Kuwait Democratic Forum 44
Kyoto Protocol 119, 121, 123, 126,
127, 133–4
economics of 128–32
impact on fuels 130–2
recent developments 132–3
Lawless, Richard 77
legitimacy of ruling families 31
LG Caltex 95
Lipset, Seymour Martin 16
Luciani, Giacomo 64, 65
Majlis al-Shura 32, 50, 67, 72, 74
Maktoum bin Rashed al-Maktoum,
Sheikh 53
Mansour al-Jamri 107
memorandum of understanding (MoU)
42
Middle East Broadcasting Centre
(MBC) 105
Ministry of Industry and Electricity
(Saudi Arabia) 98
Mitsubishi 95
Mobil 95
modernisation theory 16–17
Mohammed al-Saqr 110
Mohammed bin Rashed Al Maktoum,
Sheikh 109
Mubarak al-Sabah 43
Multilateral Working Group on Water
Resources 49
mutawaeen (Saudi Arabia) 40
NAFTA 10
140 Index
National Action Charter (Bahrain) 34,
35, 73
National Charter Committee (NCC) 72
National Commercial Bank 92
National Democratic Grouping Party
44
new development paradigm 16–18
non-governmental organisations,
international 11
Nonneman, Gerd 81
Norton, Richard Augustus 80
Qatar 30, 31, 35
demography 51–2
foreign policy 50–1
Bahrain 51
the West 51
media practice in 106–8
political context 49–50
political participation 70–1
political reform 50
Qawasim 52
quietist diplomacy 60
Okaz 114
Oman 30
demography 49
foreign relations 48–9
Saudi Arabia 48
Yemen 48–9
media 112–13
political context 46–7
political opposition 47
political participation 71–2
political reform 47–8
Oman 112
Oman Observer 112
Oman–UAE settlement 48
Omani–Yemeni border agreement 48
OPEC 86
Organisation of Islamic Conference
(OIC) 36, 51
Al-Oteibi 39
Rafsanjani, President 67, 68
Ras al-Khaimah 53
Rashed Abdullah al-Nuami 54
Reading, A. 104
Reagan, Ronald 60
rentierism 64–5
Al-Riyami, Rahella 72
Roy, Olivier 22
Rugh, W. 104
ruling families, legitimacy of 31
Pahlavi monarchy in Iran 79
Palmer, Monte 64
People’s Democratic Republic of
Yemen 46
People’s Front for the Liberation of
Oman (PFLO) 46
personal liberty 23
Phillips Petroleum 95
press–government relations 102–15
development and divergence
105–15
models of the press 103–5
Public Authority for Civil Information
45
Public Investment Fund (Saudi Arabia)
92
Qaboos bin Said, Sultan 46, 112
Saad Abdullah al-Salem al-Sabah,
Sheikh 43, 69, 111
Al-Sabah family 43, 44
SABIC (Saudi Arabian Basic Industries
Corporation) 96
Said bin Taimur 46
Al-Salim family 43
Salman, Prince of Saudi Arabia 78
Salman, Sheikh of Bahrain 33
Al-Saud family 37, 38
Al-Saud, Abdel-Rahman 37
Al-Saud, Ahmed 37
Al-Saud, Faisal bin Misha’al 76
Al-Saud, Nayef 37
Al-Saud, Salman 37
Al-Saud, Sultan 37
Al-Saud, Turki 37
Saudi American Bank 92, 98
Saudi Arabia 30, 31
budget as a percentage of GDP 90
demography 42–3, 87–9
employment 87–9
foreign debt to exports 91
foreign policy 41–2
Iran 41
Iraq 41
the West 42
Index 141
Yemen 41–2
government finances and fiscal
policy 89–91
gross domestic product 86–7
international governance and 85–100
investment 92–3
joint ventures 93–7
media 113–15
oil-dependent economy 85–7
political context 37–8
political opposition 38–40
political participation 74–6
political reform 40
privatisation 92
relations with Oman 48
WTO membership issues 97–9
Saudi Arabian Monetary Agency 98
Saudi Electricity Company 92
Saudi Industrial Development Fund 98
Saudi Telecommunications Company
92
Sawsan al-Shaier 112, 113
September 11th terrorist attacks 15, 81
Seyyed Mohammed Khatami 54
Shari’a 40
Sharon, Ariel 51
Al-Sheikh family 38
Shell 95, 96
Shi’a community 33, 34, 37, 39, 44
social forces, emergent 13
Soviet Union, dissolution of 5, 6, 25,
67
Sparks, C. 104
Stookey, Robert 60
Sudairi Seven 37
Sunni Islamists 34, 37, 39, 44
Talal, Prince 76
television 105–6
Texaco 95
Al-Thani family 49, 50, 107
TotalFina 95
trade-related aspects of intellectual
property rights (TRIPS) 99
Treaty of Friendship, Commerce and
Navigation (Oman) 46
Trucial States, emergence of 52
Turki al-Hamad 114
UAE Journalists’ Association 109
UK general election (1992) 103
United Arab Emirates (UAE) 30, 52
demography 55–6
foreign policy 54–5
Iraq 55
media 108–9
political context 52–3
political opposition 53
political participation 76–7
United Nations 4, 7, 11
United Nations Development
Programme 102
United Nations Environment
Programme 119
United Nations General Assembly
102
United Saudi Bank 92
United Technologies 99
Universal Declaration of Human
Rights (1948) 102
values, transmission of 11–12
war on terrorism 1, 15–16, 24
Western cultural values 11
women’s rights 23
‘Working Paper for Joint Gulf Action’
30
World Bank 7, 8, 14, 18, 102
Sub-Saharan Africa: From Crisis to
Sustainable Growth 1, 2, 5
World Meterological Organisation
119
World Trade Organisation 10, 51, 85,
87, 94, 95, 115
membership issues 97–9
Yemen
relations with Oman 48–9
relations with Saudi Arabia 41–2
Zakat 89
Zayed bin Sultan al-Nahayan, Sheikh,
of Abu Dhabi 53, 55, 77